Queensland Judgments
Authorised Reports & Unreported Judgments
  • sclq logo
  1. Caselaw
  2. QSC
  3. 2023
  4. Department of Transport and Main Roads v Black Cat Civil Pty Ltd - [2023] QSC 5

Authorised Reports & Unreported Judgments
Exit Distraction Free Reading Mode
  •  Notable Unreported Decision

Department of Transport and Main Roads v Black Cat Civil Pty Ltd[2023] QSC 5

Department of Transport and Main Roads v Black Cat Civil Pty Ltd[2023] QSC 5

SUPREME COURT OF QUEENSLAND

CITATION:

The State of Queensland Acting through the Department of Transport and Main Roads v Black Cat Civil Pty Ltd & Ors [2023] QSC 5

PARTIES:

THE STATE OF QUEENSLAND ACTING THROUGH THE DEPARTMENT OF TRANSPORT AND MAIN ROADS

ABN 39 407 690 291

(applicant)

v

BLACK CAT CIVIL PTY LTD

ABN 22 156 125 307

(first respondent)

CIVLEC PTY LTD

ABN 42 124 935 164

(second respondent)

PHILIP MARTIN

ADJUDICATOR NUMBER J1079741

(third respondent)

FILE NO/S:

BS 14134 of 2022

DIVISION:

Trial Division

PROCEEDING:

Miscellaneous Application – Civil

ORIGINATING COURT:

Supreme Court of Queensland at Brisbane

DELIVERED ON:

7 February 2023

DELIVERED AT:

Brisbane

HEARING DATE:

8 December 2022

JUDGE:

Bradley J

ORDER:

The Order of the Court is that:

  1. The originating application is dismissed.
  2. The applicant is to pay the first and second respondents’ costs of the proceeding.

CATCHWORDS:

ADMINISTRATIVE LAW – GROUNDS OF REVIEW – JURISDICTIONAL MATTERS – where the applicant as principal and the first and second respondents as contractor entered into a contract for construction work – where the contractor claimed additional costs and an extension of time due to a latent condition under the contract – where the adjudicator found in favour of the contractor – where the applicant submits that the adjudicator failed to consider relevant evidence – where the applicant submits that the adjudicator failed to give adequate reasons – whether the adjudicator’s decision was therefore affected by jurisdictional error – whether the adjudicator’s decision should be declared void

Building Industry Fairness (Security of Payment) Act 2017 (Qld), s 88(2), s 88(5)(b)

Acciona Agua Australia Pty Ltd v Monadelphous Engineering Pty Ltd (2020) 4 QR 410; [2020] QSC 133, applied

Annie Street JV Pty Ltd v MCC Pty Ltd [2016] QSC 268, applied

Chase Oyster Bar Pty Ltd v Hamo Industries Pty Ltd 78 NSWLR 393, cited

City of Ryde v AMFM Constructions Pty Ltd & Anor [2011] NSWSC 1469, cited

Laing O'Rourke Australia Construction v H&M Engineering & Construction [2010] NSWSC 818, cited

RJ Neller Building Pty Ltd v Ainsworth [2009] 1 Qd R 390, cited

Sierra Property Qld Pty Ltd v National Construction Management Pty Ltd [2016] QSC 108, cited

COUNSEL:

M Hodge KC, with J Mitchenson, for the applicant

T Sullivan KC, with S Eggins, for the respondents

SOLICITORS:

McCullough Robertson for the applicant

Hopgood Ganim for the first and second respondents

  1. [1]
    The applicant (the principal) seeks a declaration that a decision of the third respondent (the adjudicator) is void.  That decision is dated 1 September 2022 (the decision).  It was made pursuant to the Building Industry Fairness (Security of Payment) Act 2017 (Qld) (the Act).  If the decision is void, the principal seeks an order that the first and second respondents (jointly, the contractor) pay the principal $2,662,142.69, including GST.  This sum is part of the amount the principal paid to the contractor because of the decision.  The principal also seeks interest and costs.

Short history

  1. [2]
    On 19 January 2021, the principal and the contractor executed a written agreement (the contract).  By the contract, the contractor agreed to perform work to upgrade and widen a section of the Peak Downs Highway.  The highway links Mackay and Clermont, and so the Bowen Basin with the Whitsunday coast.  The section the subject of the upgrade is between the Caval Ridge intersection and Wuthung Road, about 14 km in length, and in the vicinity of the major sequence of coal mines near Moranbah.  The work included excavation work.  It was a construction contract to which the Act applies.
  2. [3]
    On 24 February 2022, the contractor made a claim for the additional cost and time it said was the result of encountering near non-rippable rock (NNRR) during the excavation work.  The contractor said the presence of the NNRR was a latent condition under the contract.  The contractor made three relevant claims: additional direct costs to complete the excavation work; indirect time-related costs due to prolongation of the work; and an extension of time to the date for practical completion (the NNRR claims).
  3. [4]
    On 3 May 2022, the contractor served a claim on the principal for a sum approaching $10 million.  It was about 103 pages in length.  It included the NNRR claims, and some other claims that are not presently relevant.  It was a payment claim for the purposes of the Act.
  4. [5]
    On 17 May 2022, the principal provided a payment schedule, proposing a payment of about $3 million, excluding GST.[1]  It was about 24 pages in length.  One of the reasons for the lesser sum proposed was that the principal rejected the NNRR claims on grounds set out in a letter from the contract administrator to the contractor dated 14 March 2022.
  5. [6]
    On 28 June 2022, the contractor lodged an adjudication application for the NNRR claims under the Act.  It was about 856 pages in length.  It was referred to the adjudicator, who accepted the application.
  6. [7]
    The principal sought an extension of 15 business days to provide an adjudication response.  The adjudicator granted that extension.  On 12 August 2022, the principal provided its adjudication response.  It was about 854 pages in length.
  7. [8]
    On 1 September 2022, the adjudicator determined the amount of the progress payment to be paid by the principal to the contractor, the date on which it became due and the rate of interest payable.  On payment of the relevant fee, the adjudicator issued the decision.  It was 19 pages in length.
  8. [9]
    No dispute is raised about the adjudicator’s finding that he had jurisdiction to make the decision.  Nor is it contended that the adjudicator considered any out of time response or any prohibited reason in a response.  The present application is not concerned with the parts of the decision that relate to claims other than the NNRR claims.  The NNRR claims were for an amount of $4,645,739.78, excluding GST, and an 81-day extension of time for practical completion.
  9. [10]
    Like its predecessor statutes, the Act provides “a speedy and effective means of ensuring cash flow to builders from the parties with whom they contract”.[2]  The operation of such statutes has been called “rough and ready”.  As McDougall J observed of the New South Wales equivalent legislation, such Acts provide:

“extremely abbreviated time frames for the exchange of payment claims, payment schedules, adjudication applications and adjudication responses.  It provides a very limited time for adjudicators to make their decisions on what, experience shows, are often extremely complex claims involving very substantial volumes of documents”.[3]

  1. [11]
    The determinations of adjudicators are about the right to a progress payment on account of the work performed.  In this way the Act seeks “to preserve the cash flow to a builder notwithstanding the risk that the builder might ultimately be required to refund the cash”.[4]  A final determination of the parties’ respective rights may occur after completion of all work or termination of the contract.

The issues in this application

  1. [12]
    The principal says the decision is void for two related reasons.
  2. [13]
    First, the principal says the adjudicator did not reason to four of the conclusions stated in the decision, and so each of those conclusions is arbitrary.  The principal submits that, on the face of the decision, the adjudicator leapt to each conclusion, and so failed to carry out an “active process of intellectual engagement” with those matters.  In this the principal adopted the language of McDougall J in Laing O'Rourke Australia Construction v H&M Engineering & Construction.[5]
  3. [14]
    This was more recently expressed by Bond J in Acciona Agua Australia Pty Ltd v Monadelphous Engineering Pty Ltd (Acciona):

“Adjudicators under the Payment Act do not have to get the answer right, but if it is demonstrated that they have not gone about their task by carrying out the active process of intellectual engagement with the issues and the submissions before them that the Payment Act requires, then they will have fallen into jurisdictional error because they will not have done the very thing s 88(2) of the Payment Act required them to do.”[6]

  1. [15]
    Sub-section 88(2) of the Act provides:
  1. “(2)
    In deciding an adjudication application, the adjudicator is to consider the following matters only—
  1. (a)
    the provisions of this chapter and, to the extent they are relevant, the provisions of the Queensland Building and Construction Commission Act 1991, part 4A;
  1. (b)
    the provisions of the relevant construction contract;
  1. (c)
    the payment claim to which the application relates, together with all submissions, including relevant documents, that have been properly made by the claimant in support of the claim;
  1. (d)
    the payment schedule, if any, to which the application relates, together with all submissions, including relevant documents, that have been properly made by the respondent in support of the schedule;
  1. (e)
    the results of any inspection carried out by the adjudicator of any matter to which the claim relates.”
  1. [16]
    Second, the principal submits the adjudicator failed to give the necessary reasons for each of the four conclusions in the way required by s 88(5)(b) of the Act.  That provision requires the adjudicator to “include the reasons for the decision” unless the parties “have both asked the adjudicator not to include the reasons in the decision.”
  2. [17]
    As Bond J explained in Acciona:

“the dividing line here is between a deficiency of reasons which demonstrates that the adjudicator has not discharged his or her task as contemplated by s 88, and that which does not go so far.”[7]

  1. [18]
    His Honour noted the analysis of Flanagan J in Annie Street JV Pty Ltd v MCC Pty Ltd[8] based on the observation of Brereton J in City of Ryde v AMFM Constructions Pty Ltd that:

“[t]he significance of the reasons, or their inadequacy, is that in the context of the surrounding material they may reveal jurisdictional error, or that the adjudicator has not performed the task of determining an adjudicated amount by reference to the specified relevant factors in accordance with [s 88] of the Act.”[9]

  1. [19]
    His Honour summarised the examples of deficient reasons set out in the Annie Street decision in this way:

“Circumstances in which courts have suggested that an identified deficiency of reasons may justify a conclusion of jurisdictional error include:

  1. (a)
    where the reasons do not reflect a genuine consideration of the matters identified in s 88(2);
  1. (b)
    where the adjudicator has not made the critical findings in the way contemplated by the Payment Act;
  1. (c)
    where findings or conclusions have no basis, are bare conclusions and do not reveal due consideration such that “… being insufficiently supported by reason, they appear to be an improper exercise of the power conferred or arbitrary or there was no evidence or other material sufficient to justify the making of the decision or the decision was so unreasonable that no reasonable person would have so exercised the power”;
  1. (d)
    where one party’s evidence is rejected for no reason or on no other ground than a bare conclusion that one party’s evidence is preferred over another;
  1. (e)
    where the reasons reveal no intellectual justification for the decision that was made;
  1. (f)
    where the reasons do not reveal any foundation or logical basis for the decision, so it is appropriate to conclude there has been a failure to exercise jurisdiction.”[10]
  1. [20]
    The principal says each failure by the adjudicator to comply with s 88(2) or s 88(5)(b) of the Act was a type of jurisdictional error, with the consequence that the decision is void.[11]
  2. [21]
    It is convenient to consider the principal’s challenge to each of the four conclusions in turn.

The existence of a Latent Condition

  1. [22]
    The principal says the first matter affected in this way is the adjudicator’s conclusion that the presence of NNRR was a latent condition.
  2. [23]
    Paragraph 85 of the decision is in these terms:

“I determine the condition of the material that is classified as harder than that included in the tender geotechnical report is a physical condition that differs materially and substantially from that which would reasonably have been anticipated by a competent and experienced contractor and is a latent condition as defined in the definition in clause 2 of the contract.”

  1. [24]
    The adjudicator set out the reasons for this conclusion in paragraphs 58 to 84 of the decision.
  2. [25]
    The principal says that the adjudicator did not explain how the evidence recited in the decision could lead to that conclusion.  The principal says the conclusion in paragraph 85 appears to overlook submissions made by the principal in its adjudication response.  The principal goes so far as to say that the evidence provided by the contractor referred to in the adjudication decision was not capable of leading to the conclusion expressed in paragraph 85.  The principal also says that the adjudicator may have mistakenly thought the principal bore the onus of proof.
  3. [26]
    As the adjudicator identified, the definition of “Latent Defect” is found in cl 2 of the contract.  He set it out in full in the decision:

“Latent Condition is a physical condition on the Site or its surroundings, including artificial things but excluding weather conditions, which differs materially and substantially:

  1. (a)
    from the physical conditions specified in the Reliance Information at a specific location at the Site, or
  1. (b)
    from the physical conditions which should reasonably have been anticipated by a competent and experienced Contractor at the time of the Contractor’s Tender if such a Contractor had:
  1. i.
    examined all information made available in writing by the Principal to the Contractor for the purpose of tendering,
  1. ii.
    examined all information relevant to the risks, contingencies and other circumstances having an effect on the Tender and obtainable by the making of reasonable enquiries; and
  1. iii.
    inspected and investigated the Site and its surroundings

but Latent Conditions do not include any conditions described in Item 3A.”

  1. [27]
    The principal says the adjudicator failed to reason to the conclusion that the NNRR was a latent condition, in light of sub-paragraph (b)(iii) of the definition; or, more precisely, failed to reason to the conclusion that the NNRR was a latent condition in light of the word “investigated” in that sub-paragraph of the definition.
  2. [28]
    The adjudicator received evidence from Mr Mostyn submitted by the principal in support of the payment schedule.  As Mr Hodge KC described it, Mr Mostyn’s evidence was that if a competent and experienced contractor had used a field guide to determine rock strength during the process of carrying out inspections and investigations of the site, then they could have identified and assessed rock strength and so discovered the presence of NNRR.
  3. [29]
    Mr Hodge explained that the use of a field guide is a short-hand expression for scarring the surface of exposed rock.  More broadly, Mr Mostyn said there was sufficient exposure of cuttings through the exposed rock for a competent and experienced contractor to identify the conditions actually encountered, i.e. NNRR.
  4. [30]
    The adjudicator also received evidence from Mr Butler submitted by the contractor in support of the payment claim.  Mr Butler’s evidence was that the exposed cuttings on the site were covered in fill and vegetation.  His evidence was that on a visual inspection of the site and surrounds a competent and experienced contractor could not identify the NNRR later encountered, so that an inspection would not reveal the strength of the underlying rock.
  5. [31]
    The adjudicator also placed importance on the geotechnical reports the principal gave the contractor for the purpose of tendering.  The information in those reports did not reveal NNRR was present or likely to be present on the land where the excavation work was to be undertaken.
  6. [32]
    The adjudicator dealt with Mr Mostyn’s evidence and Mr Butler’s evidence over several paragraphs in the decision.  He identified from Mr Butler’s evidence the existence of fill and vegetation as impediments to field investigation of the rock exposed in the cuttings.  He preferred Mr Butler’s opinion that the NNRR should not reasonably have been anticipated by a competent and experienced contractor at the time of the contractor’s tender to Mr Mostyn’s different opinion.  He said this was because Mr Mostyn did not explain how a field guide could be used to identify and assess the rock strength given the impediments of fill and vegetation covering the exposed cuttings on the site.
  7. [33]
    As Mr Hodge KC and Mr Mitchenson put the principal’s case, this was not an active intellectual engagement with the principal’s submission or was an absence of reasoning.  They submitted that paragraph (b) of the definition “contains a three-limb test for the existence of a Latent Condition.”  They submitted that the adjudicator made no finding “about what a competent and experienced contractor would have anticipated from inspecting and investigating the site” and that the contractor led “no evidence of what a competent and experienced contractor should reasonably have anticipated having inspected and investigated the site and surroundings.”  Their point seemed to be that the evidence from Mr Butler was confined to what a competent and experienced contractor would have anticipated from inspecting the site, and that it did not extend to what such a person would anticipate from investigating the site.
  8. [34]
    By characterising Mr Butler’s evidence as confined to what a visual inspection of the site and surroundings revealed, the principal says that evidence “is not on its face capable of leading to a finding that a competent and experienced contractor, having conducted inspections and investigations of the site and surroundings” should not have reasonably anticipated the presence of NNRR.
  9. [35]
    I do not characterise the evidence before the adjudicator in that way.
  10. [36]
    It was common ground in the adjudication that a competent and experienced contractor would not have engaged a geotechnical engineer to conduct investigations of the site and surroundings.  This was an appropriate concession, as the principal had provided geotechnical reports on the site which did not reveal anything in the nature of the NNRR the contractor says it later encountered.
  11. [37]
    Mr Butler’s evidence of the existence of fill and vegetation impeding use of a field guide, which might have been deployed for exposed rock surfaces, is evidence relevant to what a competent and experienced contractor should reasonably anticipate having inspected and investigated the site and surroundings.
  12. [38]
    I am satisfied that the adjudicator considered that evidence and reasoned to his conclusion in the context of paragraph (b) of the definition, including the composite expression “inspected and investigated” in sub-paragraph (b)(iii).  To the extent that the principal’s case is that “investigated” in sub-paragraph (b)(iii) required an individual consideration apart from consideration of the expression “inspected and investigated”, I reject it.  I also reject the principal’s submission that the decision “only makes sense” if the adjudicator “overlooked” the words “and investigated” in sub-paragraph (b)(iii).
  13. [39]
    The evidence before the adjudicator was capable of leading to the conclusion expressed in paragraph 85 of the decision.  The adjudicator explained how the evidence recited in the decision led to that conclusion.  In reaching that conclusion the adjudicator did not overlook the principal’s submissions in its adjudication response.  Rather, he rejected them because, based on Mr Butler’s evidence of impediments, the adjudicator preferred the opinion of Mr Butler to that expressed by Mr Mostyn.  This was a logical basis and the adjudicator’s intellectual justification for the conclusion.
  14. [40]
    The adjudicator did not express a specific view about the evidence in respect of the word “investigated” in sub-paragraph (b)(iii) of the definition.  This is not a basis to infer that the adjudicator failed to carry out an active process of intellectual engagement with the evidence, sufficient to comply with s 88(2).  The reasons in the decision reflect a genuine consideration of the parties’ respective submissions.  A separate finding by reference to the word “investigated” was not required and could not be regarded as critical to the determination of the contractor’s claim.
  15. [41]
    I am satisfied the adjudicator considered the evidence and gave reasons in the manner required by the Act.  There was no jurisdictional error in this respect.

Onus of proof

  1. [42]
    The principal also says that the adjudicator may have misunderstood the onus of proof.  For this submission, the principal relies on part of paragraph 79 of the decision:

“The [principal] provided a geotechnical report at the time of tender which indicated that the material that the tenderer would encounter would vary from hard digging to hard ripping.  The [principal] has not substantiated how the [contractor] could have anticipated the different materials that it encountered being classified from hard ripping to extremely hard ripping on the graph included in the Butler report and the Mostyn report by carrying out the examinations and inspections required in clause 15.1(b) of the Contract.”

  1. [43]
    In the adjudication response, the principal had accepted that, for the purposes of tendering, a competent and experienced contractor would not engage a geotechnical engineer to investigate the material to be extracted during the work.  The principal’s witness, Mr Mostyn, had proposed only an investigation of the exposed material by a field guide, which is a much lesser level of investigation.
  2. [44]
    Mr Mostyn’s opinion assumed it would have been possible to undertake an investigation by a field guide.  I have noted the evidence Mr Butler gave about fill and vegetation impeding inspection and investigation of the exposed rock cuttings on the site and surrounds.  The adjudicator accepted that evidence as an answer to the opinion evidence of Mr Mostyn.
  3. [45]
    In this respect, the decision did not turn on whether the contractor or the principal bore the onus of proving the NNRR was a Latent Condition within the meaning of the contract.
  4. [46]
    The adjudicator’s use of “substantiated” in paragraph 79 may have been inapt.  The adjudicator plainly meant that the principal did not provide evidence that explained how a field guide investigation should have revealed the NNRR, given the factual evidence of Mr Butler about the actual conditions on the site and surrounds at the time of inspection and investigation.
  5. [47]
    There was no jurisdictional error in this respect.

The notice requirement for an EOT claim

  1. [48]
    The principal challenges the part of the decision about whether the contractor’s notice of delay satisfied the contractual provision.
  2. [49]
    The adjudicator noted the relevant contract term.  It is cl 35.5(c) and (d), by which the parties relevantly agreed:

“35.5Extension of time for Practical Completion

…

  1. (c)
    If the Contractor is or will be delayed in reaching Practical Completion by a cause described in Clause 35.5(d) and within 20 Business Days after the commencement of that cause the Contractor gives the Administrator a written Claim for an extension of time for Practical Completion endorsed ‘Contractor’s Extension of Time Claim Under Clause 35.5’ and setting out the facts on which the Claim is based supported by a compliant Current Program submitted in accordance with the requirements of Clause 33.4, the Contractor shall be entitled to an extension of time for Practical Completion.
  1. (d)
    The causes are:

…

  1. ii.
    any of the following events whether occurring before, on or after the Date for Practical Completion:

…

  1. c)
    Latent Conditions”
  1. [50]
    The principal submitted to the adjudicator that the 20 business days ran from the start of the cause of the delay. The principal said the delay started months before the contractor gave the notice, because 81 days of delay were claimed to have occurred before the notice was given.  It followed, according to the principal, that the cause of the delay must have started more than 20 business days before the contractor gave the notice.
  2. [51]
    The effect of the principal’s submission is that the contractor had to give the notice of the delay caused by the latent condition within 20 business days of the commencement of the delay even if the contractor did not know a latent condition was the cause of the delay.
  3. [52]
    The adjudicator did not make the finding sought by the principal.
  4. [53]
    The adjudicator noted the evidence that the latent condition, said to be the cause of the delay, was identified in advice given to the contractor by geotechnical engineers on 31 January 2020.  The adjudicator also noted that the contractor gave notice of the delay to the principal on 24 February 2020.  The adjudicator decided the contractor had complied with the 20-business day notice requirement in the contract by “advising the Principal of the perceived latent condition once identified.”
  5. [54]
    The principal says the decision shows the adjudicator did not undertake an active process of intellectual engagement with what the notice clause in the contract required.  The principal says the adjudicator does not offer any reasoning for this part of the decision and this part of the decision makes no sense.
  6. [55]
    I am unable to accept these submissions.
  7. [56]
    The adjudicator identified the relevant clause.  It required some interpretation.  Both parties sought to persuade the adjudicator that the clause should be read in the way they proposed.  He considered the principal’s submissions and the contractor’s submissions about it.  He found the contractor had satisfied the clause by giving notice to the principal within 20 business days of the identification of the latent condition as the cause of the delay.  In doing so, the adjudicator did undertake an active process of intellectual engagement with the clause and the parties’ respective submissions.
  8. [57]
    The adjudicator may have been wrong in his conclusion.  He may have given a meaning to the clause that is not one the court would favour.  Such an error would not invalidate the decision.  If it is an error, it is one made within jurisdiction.

The assessment of the EOT claim

  1. [58]
    The principal says the part of the decision dealing with the contractor’s claim for an extension of time (the EOT claim) for delay in progress caused by the presence of NNRR is also affected by a failure to comply with s 88(2) or s 88(5)(b) of the Act.
  2. [59]
    The contractor based the EOT claim on a comparison of the “as built” and the “as planned” timeline for the project.  The comparison showed a delay of 81 days.  The contractor submitted to the adjudicator that the NNRR caused the whole of the delay identified in this way.
  3. [60]
    The contractor also submitted it had extracted 33,637 m3 of NNRR during the work.  It said it could only remove 300 m3 of NNRR per day, in contrast to 800 m3 of the material it anticipated would have to be removed.  Using these figures, the contractor calculated that 70 of the 81 days of delay could be attributed to the slower rate of removal of NNRR.  The contractor attributed the balance of 11 days of delay to “global disruption effect for managing latent condition”.  The adjudicator did not adopt this analysis as a basis for the conclusion that the NNRR had delayed the works by 81 days.
  4. [61]
    The adjudicator examined the additional time taken for construction, the updated construction programs that assessed the impact of the additional time taken for the excavation, a table listing the planned completion dates for areas of work against actual completion dates, and the claimant’s assessment of the impact of the NNRR on progress.  The adjudicator was satisfied that the presence of the NNRR had delayed the contractor in the progress of the works by 81 days.
  5. [62]
    In the payment claim and the adjudication, the contractor claimed delay costs for the removal of 33,637 m3 of NNRR.  The adjudicator declined to find that the contractor should be paid any specific amount for this claim.  He did so because he found the contractor had not substantiated that all the 33,637 m3 of material in the claim differed materially and substantially from the physical conditions that should reasonably have been anticipated by a competent and experienced contractor.  In this, the adjudicator seems to have adapted some of the language in the definition of Latent Condition.  The adjudicator was not satisfied that the contractor had proved the claimed volume of NNRR for the purposes of the delay costs claim.
  6. [63]
    The principal says this aspect of the decision shows that the adjudicator failed to undertake an active process of intellectual engagement with the principal’s submissions on the EOT claim and failed to consider whether the 81 days claimed were caused by the NNRR.
  7. [64]
    Aside from any relevant statutory provisions, the provisions in the contract, and the results of any inspection he carried out, the adjudicator was to consider only the payment claim, the payment schedule, and the parties’ respective submissions (including relevant documents) that had been properly made in support of the claim or the schedule.
  8. [65]
    The adjudicator identified the contract provisions, examined the evidence, and considered the parties’ respective submissions for the purpose of determining whether the period in the EOT claim was a period for which the contractor was entitled to an extension of time.  He decided the contractor was entitled to an extension of 81 days for the latent condition.
  9. [66]
    It is clear the adjudicator found the NNRR caused the 81 days of delay in the EOT claim.  It was not necessary for the adjudicator to make an explicit finding to that effect.  This is because the parties did not canvass causation as a separate issue in the adjudication.
  10. [67]
    The principal’s submissions about the EOT claim in support of its payment schedule were that there was no latent condition within the meaning of the contract, and so the EOT claim should be rejected; and, if it were not rejected for that reason, then it should be rejected because the contractor did not give the principal notice of the delay within 20 business days of the commencement of the cause of the delay.[12]  In its adjudication response, the principal made no specific or focussed challenge to causation of the claimed EOT.  For example, there was no contention by the principal that only a lesser period of delay was caused by the presence of the NNRR.
  11. [68]
    In the circumstances, I am satisfied that the adjudicator carried out an active process of intellectual engagement with the principal’s submissions on the EOT claim.  The adjudicator’s reasons for finding that the NNRR caused 81 days of delay in the decision do not cause me to infer that the adjudicator failed to do so.

Delay Costs allowed under cl 36 of the contract

  1. [69]
    Finally, the principal challenges the adjudicator’s finding that the contractor is entitled to be paid extra costs necessarily incurred by reason of the delay in accordance with cl 36 of the contract.
  2. [70]
    The contractor made no claim to be paid extra costs under cl 36.  That clause does not apply to delays caused by latent conditions.  It applies to other types of delays.
  3. [71]
    As Mr Sullivan KC and Mr Eggins identified, in its adjudication response the principal submitted that if the contractor was not entitled to an EOT for delay caused by the NNRR, then the contractor was also not entitled to delay costs under cl 36.  In this way, the principal directed the adjudicator’s attention to cl 36 and identified it as relevant to the contractor’s delay costs claim.  The principal did not identify or explain to the adjudicator that cl 36 did not apply to a delay claim based on a latent condition.
  4. [72]
    The adjudicator engaged with the principal’s submission.  Finding the contractor was entitled to an EOT, the adjudicator rejected the principal’s submissions, and found the contractor was entitled to delay costs under cl 36.
  5. [73]
    This was an error by the adjudicator.  However, it was made within the scope of his jurisdiction in the adjudication process.  It does not make the decision void.

Final disposition

  1. [74]
    Each of the grounds of challenge to the decision has failed.  The principal’s application should be dismissed.  The principal should pay the contractor’s costs of the proceeding.

Footnotes

[1]This was a progress certificate, under cl 43A of the general conditions of the contract, which is deemed to be the principal’s payment schedule under the Act.

[2]RJ Neller Building Pty Ltd v Ainsworth [2009] 1 Qd R 390, 401 at [40] (Keane JA).

[3]Chase Oyster Bar Pty Ltd v Hamo Industries Pty Ltd 78 NSWLR 393, 437 at [208].

[4]Neller Building op cit.

[5][2010] NSWSC 818 at [39].

[6](2020) 4 QR 410, 423-424 at [35](e).

[7]Acciona, 427 at [40].

[8][2016] QSC 268 at [29].

[9][2011] NSWSC 1469 at [9].

[10]Acciona, 427-428 at [38], footnotes omitted.

[11]Sierra Property Qld Pty Ltd v National Construction Management Pty Ltd [2016] QSC 108 at [56]- [67] (Jackson J); Annie Street JV Pty Ltd v MCC Pty Ltd [2016] QSC 268 at [23] (Flanagan J); Acciona, 426 at [37].

[12]As noted above, the adjudicator found against the principal, finding the NNRR was a latent condition, as defined in the contract, and finding the notice of delay was given within the 20-business day period.

Close

Editorial Notes

  • Published Case Name:

    The State of Queensland Acting through the Department of Transport and Main Roads v Black Cat Civil Pty Ltd & Ors

  • Shortened Case Name:

    Department of Transport and Main Roads v Black Cat Civil Pty Ltd

  • MNC:

    [2023] QSC 5

  • Court:

    QSC

  • Judge(s):

    Bradley J

  • Date:

    07 Feb 2023

  • White Star Case:

    Yes

Appeal Status

Please note, appeal data is presently unavailable for this judgment. This judgment may have been the subject of an appeal.

Cases Cited

Case NameFull CitationFrequency
Acciona Agua Australia Pty Ltd v Monadelphous Engineering Pty Ltd(2020) 4 QR 410; [2020] QSC 133
7 citations
Jump To
Cite 1 - [2020] QSC 133
Cite 2 - (2020) 4 QR 410
Cite 3 - (2020) 4 QR 410
Cite 4 - (2020) 4 QR 410
Cite 5 - (2020) 4 QR 410
Cite 6 - (2020) 4 QR 410
Cite 7 - (2020) 4 QR 410
Annie Street JV Pty Ltd v MCC Pty Ltd [2016] QSC 268
3 citations
Jump To
Cite 1 - [2016] QSC 268
Cite 2 - [2016] QSC 268
Cite 3 - [2016] QSC 268
Chase Oyster Bar Pty Ltd v Hamo Industries Pty Ltd (2010) 78 NSWLR 393
2 citations
Jump To
Cite 1 - (2010) 78 NSWLR 393
Cite 2 - (2010) 78 NSWLR 393
City of Ryde v AMDM Constructions Pty Ltd & Anor [2011] NSWSC 1469
2 citations
Jump To
Cite 1 - [2011] NSWSC 1469
Cite 2 - [2011] NSWSC 1469
Laing O'Rourke Australia Construction Pty Ltd v H&M Engineering & Construction Pty Ltd [2010] NSWSC 818
2 citations
Jump To
Cite 1 - [2010] NSWSC 818
Cite 2 - [2010] NSWSC 818
R J Neller Building Pty Ltd v Ainsworth[2009] 1 Qd R 390; [2008] QCA 397
2 citations
Jump To
Cite 1 - [2009] 1 Qd R 390
Cite 2 - [2009] 1 Qd R 390
Sierra Property Qld Pty Ltd v National Construction Management Pty Ltd [2016] QSC 108
2 citations
Jump To
Cite 1 - [2016] QSC 108
Cite 2 - [2016] QSC 108

Cases Citing

No judgments on Queensland Judgments cite this judgment.

1

Require Technical Assistance?

Message sent!

Thanks for reaching out! Someone from our team will get back to you soon.

Message not sent!

Something went wrong. Please try again.