Agripower Australia Ltd v Queensland Engineering & Electrical Pty Ltd
[2015] QSC 268
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- Unreported Judgment
- Agripower Australia Ltd v Queensland Engineering & Electrical Pty Ltd[2015] QSC 268
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Agripower Australia Ltd v Queensland Engineering & Electrical Pty Ltd[2015] QSC 268
Agripower Australia Ltd v Queensland Engineering & Electrical Pty Ltd[2015] QSC 268
SUPREME COURT OF QUEENSLAND
CITATION: | Agripower Australia Ltd v Queensland Engineering & Electrical Pty Ltd & Ors [2015] QSC 268 |
PARTIES: | AGRIPOWER AUSTRALIA LTD ACN 132 823 226 (applicant) v QUEENSLAND ENGINEERING & ELECTRICAL PTY LTD ACN 138 279 026 (first respondent) |
FILE NO/S: | BS No 1597 of 2015 |
DIVISION: | Trial Division |
PROCEEDING: | Application |
ORIGINATING COURT: | Supreme Court at Brisbane |
DELIVERED ON: | 15 September 2015 |
DELIVERED AT: | Brisbane |
HEARING DATE: | 21 April 2015 |
JUDGE: | Douglas J |
ORDER: |
|
CATCHWORDS: | CONTRACTS – BUILDING, ENGINEERING AND RELATED CONTRACTS – REMUNERATION – STATUTORY REGULATION OF ENTITLEMENT TO AND RECOVERY OF PROGRESS PAYMENTS – ADJUDICATION OF PAYMENT CLAIMS – where the applicant sought a declaration that an adjudication decision, purportedly made under the Building and Construction Industry Payments Act 2004 (Qld) (“the Payments Act”), was void and for ancillary relief – where the applicant submitted that the adjudication decision was invalid because the contract between the applicant and first respondent was illegal and unenforceable arising from the breach of two statutory provisions, one dealing with electrical safety and the other dealing with work that can only be performed by professional engineers – whether the first respondent had contravened s 56 of the Electrical Safety Act 2002 (Qld) by advertising it carried on the business of performing electrical work and performing such work when it was not the holder of an electrical contractor’s licence then in force – whether this alleged breach rendered the relevant contract illegal and recovery under the Payments Act unavailable – whether the applicant and its agents were not practising professional engineers but were carrying out professional engineering services contrary to s 115 of the Professional Engineers Act 2002 (Qld), which provides that a person who is not a practising professional engineer must not carry out professional engineering services Building and Construction Industry Payments Act 2004 (Qld) Electrical Safety Act 2002 (Qld), ss 4, 5, 15, 18(1)(b), 56 Professional Engineers Act 2002 (Qld), ss 115, 141 Cant Contracting Pty Ltd v Casella [2007] 2 Qd R 13; [2006] QCA 538, followed Master Education Services Pty Ltd v Ketchell (2008) 236 CLR 101; [2008] HCA 38, cited Yango Pastoral Co Pty Ltd v First Chicago Australia Ltd (1978) 139 CLR 410, followed |
COUNSEL: | M H Hindman for the applicant M T Hickey for the first respondent No appearance for the second and third respondents |
SOLICITORS: | TressCox Lawyers for the applicant for argument and Shine Lawyers for the applicant for delivery of judgment Boulton Cleary & Kern Lawyers for the first respondent |
- This is an application for a declaration that an adjudication decision, purportedly made under the Building and Construction Industry Payments Act 2004 (Qld) (“the Payments Act”), is void and for ancillary relief. The invalidity of the decision is said to arise because the contract between the applicant and the first respondent was illegal and unenforceable because of the breach of two statutory provisions, one dealing with electrical safety and the other dealing with work that can only be performed by professional engineers.
- The applicant submitted that the first respondent had contravened s 56 of the Electrical Safety Act 2002 (Qld) by advertising it carried on the business of performing electrical work when it was not the holder of an electrical contractor’s licence then in force. The breach alleged of that Act was said to render the relevant contract illegal and recovery under it pursuant to the Payments Act unavailable.
- The second alleged breach of statute was that the applicant and its agents were not practising professional engineers but were carrying out professional engineering services contrary to s 115(1) of the Professional Engineers Act 2002 (Qld), which provides that a person who is not a practising professional engineer must not carry out professional engineering services.
- The argument for the applicant was that the first respondent undertook to provide professional engineering services for the applicant under the supervision of a practising professional engineer when such supervision did not occur, contrary to s 141(1)(b) of that Act. Section 141(2) then provides, if that has occurred:
“(2) Despite any agreement between the person and the client, the person is not entitled to any monetary or other consideration for the performance or carrying out of the professional engineering services.”
- The first respondent accepted that, if it were carrying out professional engineering services in breach of the Professional Engineers Act, then its contract was illegal and unenforceable, pursuant to s 115(1). That conclusion is supported by the decision in Cant Contracting Pty Ltd v Casella.[1]
Background facts
- The first respondent’s director, Mr David Dillon, says in his affidavit filed 1 April 2015 that the first respondent carries on the business of providing electrical engineering and electrical works. He holds a bachelor’s degree in electrical engineering technology, but neither the company nor he is licensed to carry out electrical works. Nor is he a registered professional engineer pursuant to the Professional Engineers Act.
- The applicant argues that the contract between it and the first respondent was one pursuant to which the first respondent performed, either through Mr Dillon or through subcontractors, electrical engineering works contrary to the provisions of the Electrical Safety Act and the Professional Engineers Act.
- Mr Dillon was approached by the applicant’s project manager in early February 2013. He offered to provide electrical engineering works for the applicant at a site at Charters Towers. In about mid April 2013 he provided some modified powder plant drawings to the applicant which he says did not require any design or engineering input from him but were depicting works that had been designed and installed by others.
- Later in April 2013 he agreed to do the commissioning of the powder plant works which included starting and stopping each part of the plant and proving that each stop and start button worked as required. As part of the commissioning works he drafted step by step procedures on what to do and how to start each part of the plant. He says that he and another man called Scott Ross were there to ensure that the electrical equipment was operational. In his affidavit, however, he denied carrying out any electrical works at the plant.
- Then, in early July 2013, he agreed to carry out the preliminary electrical design portion of the works for a new plant called the granulation plant. That involved the carrying out of an audit on a number of second-hand switchboards retrieved from elsewhere intended to be used at the granulation plant. He later agreed, also in early July 2013, to provide drawings for the location of conduits for a switch room.
- On about 8 August 2013, he told the applicant’s representative that the first respondent was happy to provide an experienced industrial electrical contractor to carry out electrical work on the switch room and granulation plant for the applicant. He provided conduit drawings and the proposed switchboard audit to the applicant. The conduit drawings included an allowance for a future connection to a transformer. He says that those drawings were completed in accordance with Australian Standards, AS3000 and AS3008, which he referred to as prescriptive standards for the relevant electrical works.
- For the purposes of the Professional Engineers Act, that issue assumes importance in this debate, because the prohibition in s 115(1) against a person, who is not a practising professional engineer, carrying out professional engineering services, is itself affected by the meanings attributed to “professional engineering service” and “prescriptive standard” in Schedule 2 to that Act.
- Those statutory meanings, with my added emphasis, are:
“professional engineering service means an engineering service that requires, or is based on, the application of engineering principles and data to a design, or to a construction, production, operation or maintenance activity, relating to engineering, and does not include an engineering service that is provided only in accordance with a prescriptive standard.
…
prescriptive standard means a document that states procedures or criteria—
(a) for carrying out a design, or a construction, production, operation or maintenance activity, relating to engineering; and
(b) the application of which, to the carrying out of the design, or the construction, production, operation or maintenance activity, does not require advanced scientifically based calculations.”
- The first respondent’s case was that all the works that the first respondent carried out or caused to be carried out were done in accordance with a prescriptive standard so that a practising professional engineer was not required to supervise the works.
- Mr Dillon for the first respondent engaged another company, called Milltech Engineering Pty Ltd (“Milltech”), to assist him with the conduit drawings and then, on or about 21 August 2013, agreed with the applicant to carry out the design and construction works for the electrical portion of the granulation plant.
- He then engaged another firm called Jaysel Electrical and Instrumentation (“Jaysel”) to dismantle the required electrical switchboards and re-assemble them in a way that made them both suitable for use in the switch room for which he had prepared the conduit drawings and able to supply electricity to the electrical motors and the powder plant. He says that he did not carry out or supervise the electrical works completed at the site by the first respondent but that Jaysel did so.
- Jaysel was said to be appropriately licensed to carry out the electrical works and the first respondent’s case was that Milltech, in assisting with the design works and to program a programmable logic controller and a human machine interface for the granulation plant, did so in accordance with a prescriptive standard. Milltech was not itself appropriately licensed. Mr Dillon says, however, that, between 1 and 14 December 2013, Milltech commissioned the electrical works, including running the granulation plant in an operative mode over two weeks for a period of about 100 hours.
- Later, in February 2014, he agreed with the applicant to supply, install and commission a level switch on what was described as the “DE Powder Hopper”. The first respondent carried out that work between early April 2014 and early May 2014 with Milltech assisting with the design works and Jaysel carrying out all the electrical works.
- Then, in late March 2014, the first respondent agreed to install conveyors in the granulation plant where he says, again, that Milltech assisted with the design works and Jaysel carried out all the electrical work.
- In April 2014 the first respondent agreed to automate a valve on the bottom of an existing silo for undersized material where, again, Mr Dillon says that Milltech assisted with design works and Jaysel carried out all the electrical work.
Statutory framework
- Sections 4 and 5 of the Electrical Safety Act provide:
“4 Purpose
(1) This Act is directed at eliminating the human cost to individuals, families and the community of death, injury and destruction that can be caused by electricity.
(2) Accordingly, the purpose of this Act is to establish a legislative framework for—
(a) preventing persons from being killed or injured by electricity; and
(b) preventing property from being destroyed or damaged by electricity.
5 How purpose of Act is to be achieved
The purpose of this Act is to be achieved in the following ways—
(a) imposing duties on persons who may affect the electrical safety of others by their acts or omissions;
(b) establishing benchmarks for industry and the community generally through—
(i) making regulations, ministerial notices and codes of practice about achieving electrical safety; and
(ii) introducing safety management systems for particular electricity entities;
(c) providing for the safety of all persons through licensing and discipline of persons who perform electrical work;
(d) providing for protection for consumers against failures of persons who perform electrical work to properly perform and complete the work;
(e) establishing the Electrical Safety Board and its committees to—
(i) advise the Minister on electrical safety matters; and
(ii) allow industry and the community to participate in developing strategies for improving electrical safety; and
(iii) participate in developing requirements for the licensing and discipline of persons who perform electrical work.”
- Section 15 of the Electrical Safety Act defines “electrical installation”, among other things, as a group of items of electrical equipment that are permanently electrically connected together and can be supplied with electricity from the works of an electricity entity or from a generating source.
- Section 18 of the Electrical Safety Act gives the meaning of “electrical work” as:
“18 Meaning of electrical work
(1) Electrical work means—
(a) connecting electricity supply wiring to electrical equipment or disconnecting electricity supply wiring from electrical equipment; or
(b) manufacturing, constructing, installing, removing, adding, testing, replacing, repairing, altering or maintaining electrical equipment or an electrical installation.
Examples of electrical work—
• installing low voltage electrical wiring in a building
• installing electrical equipment into an installation coupler or interconnecter
• replacing a low voltage electrical component of a washing machine
• maintaining an electricity entity’s overhead distribution system”
- Section 56 of the Electrical Safety Act provides relevantly:
“(1) A person must not conduct a business or undertaking that includes the performance of electrical work unless the person is the holder of an electrical contractor licence that is in force.
Maximum penalty—400 penalty units.
(2) Without limiting subsection (1), a person conducts a business or undertaking that includes the performance of electrical work if the person—
(a) advertises, notifies or states that, or advertises, notifies or makes a statement to the effect that, the person carries on the business of performing electrical work; or
(b) contracts for the performance of electrical work, other than under a contract of employment; or
(c) represents to the public that the person is willing to perform electrical work; or
(d) employs a worker to perform electrical work, other than for the person.
(3) However, a person does not conduct a business or undertaking that includes the performance of electrical work only because the person—
(a) is a licensed electrical mechanic who—
(i)performs electrical work for the person or a relative of the person at premises owned or occupied by the person or relative; or
(ii) makes minor emergency repairs to make electrical equipment electrically safe; or
(b) contracts for the performance of work that includes the performance of electrical work if the electrical work is intended to be subcontracted to the holder of an electrical contractor licence who is authorised under the licence to perform the electrical work.
…”
- Section 115(1) of the Professional Engineers Act provides:
“(1) A person who is not a practising professional engineer must not carry out professional engineering services.
Maximum penalty—1000 penalty units.”
- The meanings of “professional engineering services” and “prescriptive standard” are set out earlier.
Alleged breach of the Electrical Safety Act
- The applicant’s case was that the first respondent contravened s 56(1) of the Electrical Safety Act because it conducted a business or undertaking that included the performance of electrical work. It particularised that as follows:[2]
“(i) It advertised, notified or stated that, or advertised, notified or made a statement to the effect that, it carried on the business of performing electrical work (s. 56(2)(a) ESA).
In that respect, the following evidence is relevant -
- Its name - it does not purport to provide mere electrical engineering services, but engineering and electrical services;
- Its own statement (by its director), that it carries on the business of providing electrical engineering and electrical works;
- It agreed to do commissioning works in respect of the Powder Plant. On the evidence of Dillon, ‘The commissioning works included starting and stopping each part of the plant and proving that each stop and start buttons work as required.’ That involved (on the evidence of Dillon) Dillon (and another person) ensuring that electrical equipment was operational. That electrical equipment was an appliance or apparatus for the purpose of the ESA and testing same was the performance of electrical work under s. 18(1)(b) ESA.
- On Dillon's evidence he told Agripower that Queensland Engineering & Electrical ‘was happy to provide an experienced industrial electrical contractor to carry out the electrical work on the MCC2 and Granulation Plant’ and ‘would charge a flat rate of $100 per hour for an electrician for these works’.
- It contracted for the performance of electrical work, other than under a contract of employment (s. 56(2)(b) ESA).
Whilst Qld Engineering & Electrical will contend that it falls within the exception in s. 56(3)(b) ESA that it contracted for the performance of work that included the performance of electrical work in circumstances where the electrical work was intended to be subcontracted to the holder of an electrical contractor licence who is authorised under the licence to perform the electrical work, that ought not be accepted because –
- as above at 35(i)C, it actually performed electrical work itself (through its director, Dillon). (This is also a contravention of s. 55(1) ESA by Dillon.)
- It agreed to and did (through its subcontractor, Milltech), the commissioning of electrical work which included Milltech running the Granulation Plant in an operative mode over two weeks.That electrical equipment was an appliance or apparatus for the purpose of the ESA and testing same was the performance of electrical work under s. 18(1)(b) ESA. Milltech was not licensed to perform electrical work.
- It represents to the public that it is willing to perform electrical work (s. 56(2)(c) ESA).”
- The applicant’s submission was that the first respondent had breached s 56(2)(a) of the Electrical Safety Act by the description in its name “Queensland Engineering & Electrical Pty Ltd”, express statements by its director that it carried on the business of providing electrical engineering and electrical works, its agreement to do commissioning works in respect of the powder plant, which the applicant argued was electrical work, and its express preparedness to provide an experienced electrical contractor for certain works to be performed.
- The first respondent criticised part of the evidence about Mr Dillon’s description of his company’s work as having occurred after these events. But, as Ms Hindman submitted, there was good reason to infer that that is how he described the business in advertising it, particularly when the company bore the name that it does. Ms Gossage, for the applicant, also swore in her affidavit for the adjudication response that the applicant assumed that the first respondent was registered and licensed to carry out the design and electrical work because of its trading under its company name.[3]
- The submission for the applicant in this context was that s 4 and s 5 of the Electrical Safety Act expressed its statutory purpose as including protection for consumers against failures of persons who perform electrical work to properly perform and complete the work so that the provisions of s 56 should be read objectively and not subjectively as contended for by the first respondent. I accept that submission.
- Ms Hindman pointed out that it was Mr Dillon’s evidence that he said he would do the commissioning of the powder plant works.[4] No reference was then made to the first respondent having a licensed contractor carry out the electrical works and no rate had been agreed for anyone other than Mr Dillon at that time.[5] Accordingly, on his own evidence, he had entered into a contract on behalf of his company for the performance of electrical work other than under a contract of employment.
- As to s 56(3)(b) of the Electrical Safety Act, she submitted that it did not operate as an exception to s 56(2)(a) of that Act for present purposes. She conceded that Mr Dillon might, subjectively, have intended that the electrical work be subcontracted to an appropriately licensed person but what he actually said to the applicant was that the first respondent “was happy to provide an experienced industrial electrical contractor to carry out the electrical work on the MCC2 and Granulation Plant” and “would charge a flat rate of $100 per hour for an electrician for these works”.[6] She submitted that it was that statement that should relevantly be considered for the purpose of ascertaining whether the first respondent had breached s 56(1) by reason of advertising, notifying or stating that it carried on the business of performing electrical work contrary to s 56(2)(a).
- Her argument was that s 56(3)(b) did not operate as an exception to s 56(2)(a) of the Electrical Safety Act. Rather, if s 56(2)(a) was satisfied then s 56(3)(b) would never have application as it would never be able to be concluded that the contravener had only contracted for the performance of work that included the performance of electrical work if the electrical work was intended to be subcontracted to the holder of an electrical contractor licence. For s 56(2)(a) to be effective, the contravener will have also advertised, notified or stated that it carried on the business of performing electrical work. Her submission was, and it seems to me to be correct, that s 56(3)(b) of the Electrical Safety Act is directed to a different factual scenario.
- The evidence, therefore, satisfies me that the first respondent, because of its use of the name “Queensland Engineering & Electrical Pty Ltd”, the statements made by Mr Dillon that it carried on the business of providing electrical engineering and electrical works and his responses to the applicant in agreeing to perform such work made it sufficient for an objective conclusion to be made that the first respondent breached s 56(1) by reason of conduct pursuant to s 56(2)(a) of the Electrical Safety Act.
- For reasons I consider more fully when considering the nature of the services provided by the first respondent pursuant to s 115 of the Professional Engineers Act, I have formed the view also that the work it performed was electrical work as defined in s 18 of the Electrical Safety Act. It covers at least the connection of electricity supply wiring to electrical equipment and the installation, testing, alteration or maintenance of electrical equipment or an electrical installation.
- There was also a good argument that the first respondent breached s 56(1) of the Electrical Safety Act by a breach of s 56(2)(b), namely, contracting for the performance of electrical work other than under a contract of employment. That likelihood arises because of its agreement with Milltech to run the granulation plant in an operative mode over two weeks when Milltech did not hold a licence authorising it to complete electrical work. Mr Dillon sought to rationalise what was done by Milltech by describing it as “pressing a start and stop button at each local control station to monitor whether the motors were functioning correctly. He was then required to operate the stop/start function through the PLC to ensure that the program was working correctly. This was followed by running the equipment in sequence through the PLC …”.[7]
- That work seems to me to amount to electrical work as the testing of an appliance, apparatus or electrical installation; see s 18(1)(b) and s 15 of the Electrical Safety Act. That testing took a period of approximately 100 hours and was not a minor component of the overall works. Accordingly, it seems to me that s 56(1) of the Electrical Safety Act was also contravened by reason of a breach of s 56(2)(b).
- Does such a contravention of the Electrical Safety Act make the payment of money under the Payments Act illegal? There is no equivalent in the Electrical Safety Act to s 141(2) of the Professional Engineers Act prohibiting a person from becoming entitled to any monetary or other consideration for the performance or carrying out of the professional engineering services there referred to. Nor is there an express prohibition in the Electrical Safety Act against a contract being entered into or performed in contravention of its provisions.
- The argument, therefore, was that there was an implied prohibition by the Electrical Safety Act of the contract in accordance with the principles expressed in Yango Pastoral Co Pty Ltd v First Chicago Australia Ltd. There Gibbs ACJ said:[8]
“The question whether a statute, on its proper construction, intends to vitiate a contract made in breach of its provisions, is one which must be determined in accordance with the ordinary principles that govern the construction of statutes. ‘The determining factor is the true effect and meaning of the statute’ (St. John Shipping Corporation v. Joseph Rank Ltd.). ‘One must have regard to the language used and to the scope and purpose of the statute’ (Archbolds (Freightage) Ltd. v. S. Spanglett Ltd.). One consideration that has been regarded as important in a great many cases, of which Cope v. Rowlands is a notable example, is whether the object of the statute—or one of its objects—is the protection of the public. An antithesis is commonly suggested between an intention to protect the public and an intention simply to secure the revenue, and it is said that when the former intention appears the contract must be taken to be prohibited, whereas if the intention is only to protect the revenue the statute will not be construed as imposing a prohibition on contracts. The question whether the statute was passed for the protection of the public is one test of whether it was intended to vitiate a contract made in breach of its provisions, but I am with respect in full agreement with the views expressed in St. John Shipping Corporation v. Joseph Rank Ltd. and Shaw v. Groom that it is not the only test. It would be contrary to reason and principle to allow one circumstance to override all other considerations in the interpretation of a statute. As Devlin J. said in St. John Shipping Corporation v. Joseph Rank Ltd.: ‘The fundamental question is whether the statute means to prohibit the contract. The statute is to be construed in the ordinary way: one must have regard to all relevant considerations and no single consideration, however important, is conclusive.’ See also Shaw v. Groom.”
- In this context Ms Hindman relied upon one of the objects of the Act being the protection of the public, derived from s 4 and s 5. Those sections could hardly be more emphatic in expressing the purpose of the Act, especially s 4(1) and s 5(a), s 5(c) and s 5(d). It is not permissible to allow one such circumstance to override all other considerations in the interpretation of the statute but, in this context, electrical safety of members of the public through the proper licensing and discipline of persons who perform electrical work, it is a strong indication that a contract entered into with an unlicensed person is itself prohibited. Although the Act imposes penalties for licensing contraventions, it seems clear that it is not merely concerned with “securing the revenue”.
- Therefore, I conclude that the breach of s 56(1) of the Electrical Safety Act leads to the illegality of a contract entered into by a person not the holder of an electrical contractor licence that was in force.
Alleged breach of s 115 of the Professional Engineers Act
- The applicant’s argument in respect of the breaches it alleged of s 115 of the Professional Engineers Act was that the first respondent contravened s 115 because, at least in respect of design services provided in relation to the various electrical works, the DE Hopper Works, the granulation plant conveyor works and the undersized hopper automation works referred to in Mr Dillon’s affidavit, those design services included the provision of professional engineering services and that they involved engineering services that required or were based on the application of engineering principles and data to a design, construction, production, operation or maintenance activity relating to engineering and did not include an engineering service provided only in accordance with a prescriptive standard.
- The first respondent’s argument was that the work it performed was done, as I have said, by reference to AS3000 and AS3008 in particular. It became apparent during the cross-examination of Mr Dillon by Ms Hindman that there were significant areas of the work performed by his company which were not provided only in accordance with such a documented prescriptive standard. The following were examples:
- The first respondent specified shielded rather than unshielded cables in respect of the reassembled second-hand switchboards.[9]
- The first respondent prepared design drawings showing the location of conduits in the switch room, to be installed allowing for a future connection to a transformer and the location of proposed cabinets. Mr Dillon said these were hardly something designed but were more akin to putting a concept on paper and were not engineering services. In the overall context of the nature of the work done this seemed unlikely to me.[10]
- The electrical design of the granulation plant included the design for the reassembly of the second-hand electrical switchboards to make them suitable for use in the switch room. This included the replacement of 110 volt wiring with 12 volt direct current (“DC”) wiring. Mr Dillon conceded that the standards did not go down to the level required for this design function but that was something “you learn in doing your degree or your trade”. That seemed to me to be a telling admission by him.[11]
- The electrical design included the installation of a programmable logic controller stop button which controls part of the switchboard.[12]
- A level switch was installed mounted in a powder hopper with significant changes to the programmable logic controller’s program code.[13]
- The design for the installation for two new conveyors for the granulation plant conveyor works included the power and control cables required for the conveyors.[14]
- The design of the undersized hopper automation works included the automation of a valve on the bottom of an existing silo for undersized material which included a junction box, a level switch, a solenoid and a light or bag change indicator.[15]
- The evidence establishes to my satisfaction that the first respondent was performing professional engineering services. The cross-examination has also established to my satisfaction that Mr Dillon and Milltech on behalf of the first respondent were carrying out such services and not only in accordance with a documented prescriptive standard. It seems clear that certain of the design and other functions performed by them could not be related directly to a document that stated procedures or criteria for carrying out the design, operation or maintenance activity and some of which may have required advanced scientifically based calculations, such as the changes to the programmable logic controller’s program code.
- The applicant also led evidence from a Mr Pollock who was employed by the Snowy Mountains Engineering Corporation as manager of its energy group. He himself was not an electrical engineer but managed a group of electrical engineers and had made a number of reports in the form of affidavits tendered to the adjudicator who made the decision that has been challenged. His organisation had been consulted about modifications to the site required by the applicant after the work done by the first respondent.
- He had expressed his belief in one of those affidavits used for the adjudication that the design work undertaken at the site was work that fell within the meaning of “professional engineering services” under the Professional Engineers Act but his expertise in expressing such an opinion was attacked. He responded to a question on the topic by saying:
“It’s a quite complex site involving a number of different pieces of technology that are integrated together. It involves complex programming of programmable logic controllers. It involves second-hand switchboards sourced from a mine site. Under any consideration it is a complex site …”[16]
- He agreed, in that context, that he had formed that conclusion on taking a global view of the site as a whole and that he did not have the qualifications or skill of a professional engineer. In those circumstances I have not relied on his evidence to conclude that the first respondent was carrying out professional engineering services. It seemed to me to have been established by Mr Dillon’s own evidence.
- Mr Hickey, for the first respondent, also criticised the applicant for not having called an expert professional engineer to give evidence about some of these issues. He pointed to the potentially serious consequences of my decision on Mr Dillon and his company as a circumstance demanding that the applicant prove its case by such evidence. Nonetheless, it seems clear to me, from the admissions made by Mr Dillon in his evidence, including the cross-examination, that the first respondent was carrying out professional engineering services in breach of the Act.
- The applicant had also referred in argument to a practice note from the Board of Professional Engineers dealing with the meaning of the terms “professional engineering service” and “prescriptive standard” in the Professional Engineers Act. These were actually tendered through Mr Dillon.[17] The Board expressed its opinion on the operation of the relevant provisions in terms which did not assist the first respondent’s argument that it was following a prescriptive standard. The notes, for example, included an assertion that a professional decision to use a particular document which states procedures or criteria is unlikely to be provided only in accordance with a prescriptive standard because the decision to use the document is unlikely to be a decision taken in accordance with the document itself.
- Similarly, the practice note series produced by the Board said:[18]
“The document must detail and explain exactly how the procedures or criteria are to be applied to the task to which the document relates …
The use of the word ‘prescriptive’, which means ‘laying down the rules of usage”, means there must be little or no room for personal choice or judgement in the application of the procedures or criteria stated in the document.”
- One can readily understand why the Board used such language in seeking to interpret the statute for its members. My conclusions about the interpretation of the Act have, however, been arrived at independently of those conclusions even if those documents tend to support the approach I have adopted. They are simply the Board’s opinion, not binding on me and not pressed as binding by the parties.
- It can also be said, as Ms Hindman submitted, that, for example, the AS3000 (Wiring Rules) relied on by the first respondent did not satisfy the requirements of being a prescriptive standard in every aspect of that document, because it does not always say how tasks are to be performed, leaving significant room for professional judgment. Similarly, application of some of the clauses in that Australian Standard may require advanced scientific calculations. AS3000 is itself divided into two parts requiring a choice to be made by a designer about which part to apply in a particular situation. The likely result is that matters of professional judgment will be brought into play by the making of such a decision rather than simply the application of set procedures and criteria.
- Accordingly I have formed the view that the first respondent’s contract was also illegal as contrary to s 115(1) of the Professional Engineers Act.
Conclusion and orders
- Those conclusions on the facts of the case lead me to decide, consistently with Cant Contracting Pty Ltd v Casella,[19] that the first respondent’s contract with the applicant was illegal. The result is that it was not entitled to progress payments under the Payments Act and the adjudication decision is void for jurisdictional error.
- The consequence is that the application should succeed and I shall declare that the adjudication decision 1057877_3025 dated 18 December 2014 by the Adjudicator third respondent, Callum Campbell, is void. I shall also declare that the adjudication certificate issued by the second respondent in respect of the adjudication decision is void and restrain the first respondent from enforcing or otherwise relying upon the adjudication decision.
- Having heard the parties as to costs, I further order that the first respondent pay the applicant’s costs of and incidental to the originating application, including reserved costs.
Footnotes
[1] [2007] 2 Qd R 13.
[2] See its written submissions filed 13 April 2015 at pp 9-10 [35] (footnotes omitted). “ESA” is an acronym for the Electrical Safety Act.
[3] See the affidavit of Adam James Hempenstall filed 16 February 2015 at p 191 of the exhibits.
[4] See the affidavit of David Tone Dillon filed 1 April 2015 at para 17.
[5] See the affidavit of David Tone Dillon filed 1 April 2015 at para 26.
[6] See the affidavit of David Tone Dillon filed 1 April 2015 at para 26.
[7] See the affidavit of David Tone Dillon filed by leave 21 April 2015 para 4(b). “PLC” is an acronym for “programmable logic controller”.
[8] (1978) 139 CLR 410, 413-414 (footnotes omitted). See also Master Education Services Pty Ltd v Ketchell (2008) 236 CLR 101, 107 at [11].
[9] See T 1-43 l 27 – 1-46 l 27
[10] See T 1-49 ll 15-35.
[11] See T 1-49 l 40 – 1-52 l 39.
[12] See T 1-52 l 41 – 1-55 l 10.
[13] See T 1-55 l 12 – 1-57 l 47.
[14] See T 1-58 ll 1-39.
[15] See T 1-59 l 27 – 1-64 l 31.
[16] See T 1-12 ll 35-40.
[17] See the affidavit of David Tone Dillon filed 1 April 2015 at pp 5-9 in ex DD2 and ex DD3.
[18] See the affidavit of David Tone Dillon filed 1 April 2015 at pp 8-9 in ex DD3.
[19] [2007] 2 Qd R 13.