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Paladin Projects Pty Ltd v Visie Three Pty Ltd[2024] QSC 230

Paladin Projects Pty Ltd v Visie Three Pty Ltd[2024] QSC 230

SUPREME COURT OF QUEENSLAND

CITATION:

Paladin Projects Pty Ltd v Visie Three Pty Ltd & Ors [2024] QSC 230

PARTIES:

PALADIN PROJECTS PTY LTD ACN 604 051 578

(applicant)

v

VISIE THREE PTY LTD ACN 601 326 667

(first respondent)

NANCY ALEXANDER (ADJUDICATION REGISTRAR)

(second respondent)

DAVID ROBERT THOMAS SEENEY (ADJUDICATOR J1261305)

(third respondent)

FILE NO/S:

BS No 6272 of 2024

DIVISION:

Trial Division

PROCEEDING:

Originating Application

ORIGINATING COURT:

Supreme Court at Brisbane

DELIVERED ON:

25 September 2024

DELIVERED AT:

Brisbane

HEARING DATE:

19 June 2024

JUDGE:

Williams J

ORDERS:

  1. The parties are directed to agree an order reflecting these reasons and provide it to the Associate to Williams J by 2 October 2024.
  2. If an order cannot be agreed, both parties are directed to provide their proposed order, together with an explanation for the differences of no more than 2 pages, to the Associate to Williams J by 2 October 2024.
  3. I will hear from the parties as to costs after the order has been made.

CATCHWORDS:

CONTRACTS – BUILDING, ENGINEERING AND RELATED CONTRACTS – REMUNERATION – STATUTORY REGULATION OF ENTITLEMENT TO AND RECOVERY OF PROGRGRESS PAYMENTS – ADJUDICATION OF PAYMENT CLAIMS – where the applicant, as a contractor, entered into a construction contract with the first respondent, as principle – where the applicant lodged an adjudication application in respect of a Payment Claim – where the applicant seeks judicial review of the adjudicator’s decision – whether parts of the adjudication decision are affected by jurisdictional error – whether the adjudicator considered new reasons for withholding payment in contravention of s 88(3)(b) – whether the adjudicator considered material outside the statutory limitation in s 88(2) – whether the adjudicator’s decision denied the applicant natural justice – whether it was established on the evidence that there was a realistic possibility the adjudicator would have made a different decision – whether orders that the identified parts of the adjudication decision be severed pursuant to s 101(4) of the Building Industry Fairness (Security of Payment) Act 2017 (Qld)

ADMINISTRATIVE LAW – JUDICIAL REVIEW – GROUNDS OF REVIEW – JURISDICTIONAL MATTERS – where the applicant, as a contractor, entered into a construction contract with the first respondent, as principle – where the applicant lodged an adjudication application in respect of a Payment Claim – where the applicant seeks judicial review of the adjudicator’s decision – whether parts of the Adjudication Decision are affected by jurisdictional error and are void with the balance of the adjudication decision to remain binding on the parties to the proceeding

Building Industry Fairness (Security of Payment) Act 2017 (Qld), s 82(3)-(5), s 88(3)(b), s 101(4)

Building and Construction Industry (Portable Long Service Leave) Act 1991 (Qld) s 75,

Queensland Building and Construction Commission Act 1991 (Qld) s 68B, s 70

Acciona Agua Australia Pty Ltd v Monadelphous Engineering Pty Ltd [2020] QSC 133, followed

Northbuild Construction Sunshine Coast Pty Ltd v Beyfield Pty Ltd [2015] 1 Qd R 463, applied

The Minister for Commerce v Contrax Plumbing (NSW) Pty Ltd [2005] NSWCA 142, cited

Coordinated Construction Co Pty Ltd v Climatech (Canberra) Pty Ltd & Ors [2005] NSWCA 229, cited

Ceerose Pty Ltd v A-Civil Aust Pty Ltd [2023] NSWCA 215, cited

State Water Corporation v Civil Team Engineering [2013] NSWSC 1879, cited Musico v Davenport [2003] NSWSC 977, cited

MZAPC v Minister for Immigration and Border Protection (2021) 95 ALJR 441, cited

Ostwald Bros Pty Ltd v Jaylon Pacific Pty Ltd & Ors [2016] QSC 240, cited

John Holland Pty Ltd v TAC Pacific Pty Ltd & Ors [2009] QSC 205, cited

Minister for Immigration and Citizenship v SZJSS [2010] HCA 48, cited

Ingeteam Australia Pty Ltd v Susan River Solar Pty Limited & Ors [2024] QSC 30, cited

COUNSEL:

D L Atkinson KC for the applicant

B A Reading for the first respondent

SOLICITORS:

McInnes Wilson Lawyers for the applicant

Clayton Utz for the first respondent

  1. [1]
    The Applicant and the First Respondent are parties to a contract for the design and construction of 36 townhouses, together with certain civil works (Contract). The Applicant is the contractor and the First Respondent is the principal.
  2. [2]
    The Applicant seeks judicial review of an adjudication decision made on 7 May 2024 (Adjudication Decision) by the Third Respondent, the Adjudicator. The Second Respondent is the Adjudication Registrar.
  3. [3]
    The Applicant applies for:
    1. declarations that parts of the Adjudication Decision are affected by jurisdictional error and are void (being the parts of the Adjudication Decision deciding liquidated damages, Variation 60 and Variation 62) and that the balance of the Adjudication Decision remains binding on the parties to the proceeding.
    2. orders that the identified parts of the Adjudication Decision be severed pursuant to s 101(4) of the Building Industry Fairness (Security of Payment) Act 2017 (Qld) (BIF Act).
  4. [4]
    Alternatively, the Applicant seeks an order that the Adjudication Decision be set aside.
  5. [5]
    The Second and Third Respondents did not participate in the hearing on the basis that they abide the order of the Court and were excused from attending the hearing of the application save as to the issue of costs, should it arise.
  6. [6]
    The First Respondent opposes the application and submits that the Adjudication Decision is not affected by jurisdictional error.

Payment Claim, Payment Schedule and Adjudication Application

  1. [7]
    On 7 December 2023, the Applicant made Payment Claim 23 (Payment Claim) claiming a progress payment of $1,467,850.36 (excluding GST).
  2. [8]
    On 21 December 2023, the Superintendent issued a Payment Certificate in respect of Payment Claim 23 (Payment Schedule).
  1. [9]
    On 20 February 2024, the Applicant lodged an adjudication application in respect of Payment Claim and on 28 February 2024 the adjudication application was referred to the Third Respondent (Adjudication Application).
  2. [10]
    On 7 May 2024, the Third Respondent published the Adjudication Decision.
  3. [11]
    The Applicant now seeks to challenge the Adjudication Decision on the basis that the parts of the Adjudication Decision deciding liquidated damages, Variation 60 and Variation 62 are affected by jurisdiction error and are void.
  4. [12]
    The jurisdictional error alleged by the Applicant in respect of each of the three parts is different, namely:
    1. In respect of Variation 60 – jurisdictional error by a contravention of s 88(3)(b) of the BIF Act. That is, the Third Respondent considered “new reasons” for withholding payment within s 82(4) of the BIF Act, contrary to the prohibition in s 88(3)(b) of the BIF Act.
    2. In respect of Variation 62 – jurisdictional error by a contravention of s 88(2) of the BIF Act. That is, the Third Respondent considered the Building and Construction Industry (Portable Long Service Leave) Act 1991 (Leave Act) and Part 5 of the Queensland Building and Construction Commission Act 1991 (Qld) (QBCC Act) which were outside the limited matters listed in s 88(2) of the BIF Act.
    3. In respect of liquidated damages – jurisdictional error by a substantial breach of natural justice.
  5. [13]
    In respect of Variation 62, the First Respondent contends that it is more properly characterised as the Third Respondent making the decision on a basis for which neither party contended, thereby constituting a denial of natural justice. Further, the First Respondent contends that had the Applicant had the opportunity to lead further evidence and or make further submissions, there is not a realistic possibility that the Third Respondent would have made a different decision.
  6. [14]
    In respect of this alternative characterisation of Variation 62, the Applicant contends for the opposite conclusion and relies on this as an alternative basis for jurisdictional error.

Agreed facts

  1. [15]
    The parties agreed the following facts:

“Variation 62

  1. Neither [the Applicant] nor [the First Respondent] averted to section 75 of the [Leave Act], and sections 68B and 70 of Part 5 of the [QBCC Act].
  2. The Adjudicator did not request further submissions from [the Applicant] and [the First Respondent] in respect of the provisions of the [Leave Act] and Part 5 of the [QBCC Act].

Liquidated Damages

  1. In relation to [Extension of Time][1] Claim 34, neither [the Applicant] nor [the First Respondent] contended that the civil engineering consultant was novated from [the First Respondent] to [the Applicant].”

Issues to be determined

  1. [16]
    The parties were unable to agree a list of issues to be determined by the Court. The Applicant proposed 27 questions and the First Respondent proposed 10 questions (some with sub-questions).
  2. [17]
    The Applicant’s questions identify a range of matters that may be relevant to the consideration of the issues to be determined by the Court. However, in a number of respects the questions are broader than what needs to be determined on the current application.
  3. [18]
    The First Respondent’s articulation of the questions to be determined provides a more focused approach.
  4. [19]
    However, I consider the preferable structure is to address the key issues to be determined and consider the various relevant matters under each issue.
  5. [20]
    Accordingly, the key issues to be determined are as follows:
  1. (a)
    In respect of Variation 60, did the Third Respondent consider “new reasons” for withholding payment within s 82(4) of the BIF Act, contrary to the prohibition in s 88(3)(b) of the BIF Act.
  1. (b)
    In respect of Variation 62, by considering the Leave Act and Part 5 of the QBCC Act did the Third Respondent consider matters outside the limited matters listed in s 88(2) of the BIF Act.
  1. (c)
    Further, in respect of Variation 62:
  1. (i)
    by considering the Leave Act and Part 5 of the QBCC Act in making the relevant part of the Adjudication Decision did the Third Respondent deny the Applicant natural justice; and
  1. (ii)
    was there a realistic possibility that the Third Respondent would have reached a different decision if the Applicant had the opportunity to put in further evidence and/or submissions.
  1. (d)
    In respect of liquidated damages:
  1. (i)
    in making the relevant part of the Adjudication Decision did the Third Respondent deny the Applicant natural justice; and
  1. (ii)
    was there a realistic possibility that the Third Respondent would have reached a different decision if the Applicant had the opportunity to put in further evidence and/or submissions.
  1. [21]
    In accordance with the authorities discussed later in these reasons, if the answer to one or more of these questions is yes, then that part of the Adjudication Decision relevant to that question is affected by jurisdictional error.[2]

Relevant legislation and authorities

  1. [22]
    The adjudication process under the BIF Act requires the adjudicator to decide the amount of a progress payment, if any, to be paid by a respondent to a claimant, being the adjudicated amount.[3] The adjudicator’s decision must be in writing and include the reasons.[4]
  2. [23]
    Section 88(2) of the BIF Act specifies the matters that the adjudicator is to consider in deciding an adjudication application, and states as follows:
  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. [24]
    Further, s 88(3) of the BIF Act identifies matters that the adjudicator “must not consider” as follows:
  1. “(3)
    However, the adjudicator must not consider any of the following—
  1. (a)
    an adjudication response, to which the adjudication application relates, that was not given to the adjudicator within the time required under section 83;
  1. (b)
    a reason included in an adjudication response to the adjudication application, if the reason is prohibited from being included in the response under section 82.”
  1. [25]
    Section 88(4) is relevant to the limitation in sub- section (3) and states as follows:
  1. “(4)
    Also, the adjudicator may disregard an adjudication application or adjudication response to the extent that the submissions or accompanying documents contravene any limitations relating to submissions or accompanying documents prescribed by regulation.”
  1. [26]
    Under the legislative scheme a payment claim is made claiming a progress payment and a payment schedule is to be provided within the relevant timeframe, otherwise the amount in the payment claim is to be paid in full. If a payment schedule is provided, then the amount proposed in the payment schedule must be paid.
  2. [27]
    An adjudication application may be lodged seeking payment, usually for the difference between the payment claim amount and the payment schedule amount.
  3. [28]
    Section 82 governs the adjudication response given by the respondent to the adjudication application.
  4. [29]
    Section 82(2) relevantly provides:

“However, the respondent must not give an adjudication response if the respondent failed to give the claimant a payment schedule as required under section 76.”

  1. [30]
    Further s 82(4) of the BIF Act provides:

“However, the adjudication response must not include any reasons (new reasons) for withholding payment that were not included in the payment schedule when given to the claimant.” (emphasis in original)

  1. [31]
    Under s 82(5) an adjudicator may require a respondent to resubmit an adjudication response without new reasons.
  2. [32]
    The limitation in s 88(3)(b) of the BIF Act links back to s 82 in respect of the adjudication response. Accordingly, “new reasons” in an adjudication response not included in a payment schedule must not be considered by the adjudicator.
  3. [33]
    Considering the issues in turn.

Variation 60 – did the Third Respondent consider “new reasons” contraryto the prohibition in s 88(3)(b) of the BIF Act?

  1. [34]
    The issue in respect of Variation 60 is whether the Third Respondent considered “new reasons” for withholding payment within s 82(4) of the BIF Act, contrary to the prohibition in s 88(3)(b) of the BIF Act.
  2. [35]
    Variation 60 is a claim by the Applicant for principal caused delay damages in the amount of $418,190.00 plus GST.
  3. [36]
    The Applicant points to the response of the First Respondent in the Payment Schedule, namely “Variation 60 has not been approved. Reasons provided in response to VAR 60 dated 1 December 2023”.[5]
  1. [37]
    That response from the Superintendent dated 1 December 2023 states as follows:[6]
  1. “Assessment
  1. Upon review of the claim, my assessment is that the Variation Claim is not approved. Assessment of any damages will be considered in line with the calculation of liquidated damages upon achievement of practical completion. At this stage, because practical completion has not yet been achieved, the Contractor has no entitlement to such a claim and the Variation Claim is not capable of being assessed.”
  1. [38]
    The Applicant contends that the First Respondent’s position can be understood as being that the Applicant was not entitled to its claim because practical completion had not been achieved. However, by the time of the Payment Schedule issued on 21 December 2023 the date of practical completion had passed, being 13 December 2023.
  2. [39]
    Consistent with this, the Applicant notes that in the Payment Schedule the First Respondent also claimed liquidated damages on the basis that the date of practical completion was 13 December 2023.
  3. [40]
    The Applicant contends that the First Respondent’s adjudication response (Adjudication Response) includes “new reasons” for withholding the payment for Variation 60, namely that:
    1. “Under clause 34.9 of the [Contract], the entitlement to delay damages is expressly contingent upon an EOT having been granted by the Superintendent”.[7]
    2. Seven of the nine EOT claims for which delayed damages were sought had not been granted by the Superintendent and were the subject of dispute.[8]
    3. “It would not be appropriate for the Adjudicator to find that delay damages are payable in respect of EOTs which have not been granted, in the absence of determinations by the Adjudicator that such extensions of time ought to have been granted.”[9]
    4. “The Adjudicator must also be satisfied that the alleged delays are from a compensable cause”.[10]
    5. At least some of the EOT claims in question did not relate to a “compensable cause” within the meaning of the Contract.[11]
  4. [41]
    The Applicant contends that:
    1. Pursuant to s 82(4) of the BIF Act the First Respondent was prohibited from including these “new reasons” in the Adjudication Response.
  1. The Third Respondent in the Adjudication Decision determined Variation 60 by assessing the Applicant’s entitlement to EOTs under clause 34.9 of the Contract and its entitlement to delay damages by reference to whether the EOTs so assessed were from a “compensable cause” as submitted by the First Respondent in the Adjudication Response.[12]
  1. [42]
    Ultimately, after accepting 24 days of “compensable cause delay”, the Third Respondent arrived at a value for Variation 60 of $64,572.[13]
  2. [43]
    The Applicant relies upon the comments of Bond J in Acciona Agua Australia Pty Ltd v Monadelphous Engineering Pty Ltd.[14] In that case, Bond J considered s 88(3)(b) of the BIF Act. His Honour held that the valid exercise of the adjudication jurisdiction is conditioned on compliance with s 88(3)(b) of the BIF Act, such that a failure to comply with the condition invalidates the purported exercise of power.[15]
  3. [44]
    The Applicant contends that the Third Respondent failed to comply with this condition, including as follows:
    1. At [364] the Third Respondent refers to the reasons contained in the Payment Schedule and then at [365] states that the submissions “extend” those reasons.
    2. At [366] to [376], the Third Respondent agrees with the First Respondent’s position that Variation 60 is a claim for delay damages in accordance with clause 34.9 of the Contract.
  4. [45]
    The Applicant submits that this approach is impermissible and amounts to jurisdictional error. Further, the Applicant contends that unless and until declared invalid, the Adjudication Decision in respect of Variation 60 remains in force and the Applicant is precluded from pursuing Variation 60 in a further payment claim. In these circumstances, the Applicant contends that the Adjudication Decision in respect of Variation 60 should be declared invalid and pursuant to s 101(4)(a) of the BIF Act, identified as affected by jurisdictional error.
  5. [46]
    In respect of Variation 60 the First Respondent submits as follows:
    1. The effect of s 88(3)(b) of the BIF Act is that an adjudicator must not “consider” a “new reason for withholding payment” included with an adjudication response.
    2. Whether the reason for withholding payment is “new” is determined by reference to the payment schedule.
    3. “Consider” must be read in context. The First Respondent submits that what is prohibited is an adjudicator undertaking an analysis of the “new reasons” and deciding whether those reasons justify the withholding of payment from the claim. That is, it requires an “active intellectual process” and a “process of evaluation sufficient to warrant the description” of the matters being taken into consideration.[16]
  1. [47]
    The First Respondent contends that it is not enough to point to anything not expressly said in a payment schedule that is contained in an adjudication response as being “a new reason for withholding payment”. That is, the focus is on a new reason “for withholding payment”.
  2. [48]
    Further, even if there is a “new reason for withholding payment” contained in an adjudication response, an adjudicator must have actively considered that “new reason” to “fall foul” of the provision. That is, the adjudicator has engaged in an “active intellectual process” with the “new reason”. It is contended that to determine whether this has occurred or not can only be done by an objective reading of the adjudicator’s decision.
  3. [49]
    The First Respondent contends that the decision in Acciona is a clear example of what it means for an adjudicator to consider “new reasons for withholding payment”. On the facts in that case, Monadelphous advanced a single reason for withholding payment from Acciona, being an alleged entitlement to recover $5.3 million “contribution”. Monadelphous asserted in its payment schedule that its entitlement to recover this contribution had the effect that the claimant’s claim was reduced to nil.
  4. [50]
    However, in the adjudication response, Monadelphous advanced several new reasons for withholding payment, specifically new alleged breaches of contract. The adjudicator’s decision set out the specific new alleged breaches. Bond J undertook an analysis of the adjudicator’s decision and found that the adjudicator had used the new reasons “to justify his ultimate conclusion”.[17]
  5. [51]
    It is submitted by the First Respondent, that Acciona is a clear example of an adjudicator considering new reasons for withholding payment and acting upon them in arriving at a decision in respect of contractual entitlement.
  6. [52]
    Turning to the particular circumstances of this case, the First Respondent acknowledges that the Third Respondent obviously read the First Respondent’s submissions which contained the alleged new reasons. However, the First Respondent contends that:
    1. these were not “new reasons for withholding payment”; and
    2. even if they were, the Third Respondent did not “consider” them in the sense of undertaking an analysis of them and deciding whether those reasons justified the withholding of payment from the Applicant.
  7. [53]
    The Third Respondent expressly agreed with the First Respondent’s submission that “variation 60 is a claim for delay damages in accordance with clause 34.9 of the Contract”. The Applicant relies upon this statement as evidencing that the Third Respondent must have “considered” the First Respondent’s alleged new reasons. However, the First Respondent submits that this statement is not a “new reason for withholding payment”.
  1. [54]
    Rather, this is a statement regarding the proper description or characterisation of the Applicant’s claim which was included in the Payment Schedule. That is, by reference to the Superintendent’s response of 1 December 2023 the claim seeks “delay damages arising from alleged principal caused delays”.
  2. [55]
    This also needs to be considered in the context of the Payment Claim.
  3. [56]
    The Applicant’s Payment Claim describes Variation 60 as a claim for “principal caused delay damages”. The First Respondent contends that this characterisation was then repeated by the Applicant as follows:[18]
    1. In the Applicant’s adjudication application submissions at [11.2], [11.4], [11.5] and [11.9].[19]
    2. In the statutory declaration of Jessica Thompson dated 20 February 2024, provided on behalf of the Applicant, the Applicant describes Variation 60 as:
  1. “In  accordance with Clauses 34.9 and 41.1 of the General Conditions of Contract”; and
  1. “pursuant to clause 34.5 of the General Conditions of Contract”.[20] (emphasis added)
  1. [57]
    Given the Applicant’s own description of Variation 60 in the Payment Claim and the First Respondent referring to it in the Payment Schedule, the fact that the Third Respondent agreed that Variation 60 was in fact a claim for delay damages pursuant to clause 34.9 of the Contract could not have been contentious.
  2. [58]
    Further, the First Respondent contends that the Third Respondent’s reference to agreeing with the First Respondent’s characterisation of that claim is not a “consideration of a new reason for withholding payment”.
  3. [59]
    The First Respondent submits that at its highest this should be read as indicating that the Third Respondent had read the First Respondent’s submission and had reached the view that Variation 60 was properly described under the Contract as a claim for delay damages. That is, this does not amount to a consideration of a reason for withholding payment.
  4. [60]
    Further, the First Respondent deals with the submission that the Third Respondent must have considered the First Respondent’s new reasons as the Third Respondent considered whether the EOT claims related to a “compensable cause”.
  5. [61]
    The First Respondent’s adjudication response submissions do make reference to a “compensable cause” including:
    1. “it is clear from the submissions in Section 8.8 below that at least some of the EOT claims in question do not relate to a compensable cause within the meaning of the Contract”;
  1. “the [Adjudicator] must also be satisfied that the alleged delays are from a compensable cause”; and
  2. “it would not be appropriate for the Adjudicator to find that delay damages are payable in respect of EOTs which have not been granted in the absence of determinations by the Adjudicator that such extensions of time ought to have been granted.”
  1. [62]
    In support of its contention, the First Respondent submits that the Third Respondent made no specific reference to these particular submissions within the Adjudication Decision. Accordingly, the Applicant’s contention that the Third Respondent must have considered the submissions is based upon inference.
  2. [63]
    The First Respondent contends that some “active intellectual process” in respect of these specific submissions must be shown on an objective reading of the Adjudication Decision.
  3. [64]
    The Applicant’s complaint focuses on the Third Respondent’s consideration of whether EOT claims made by the Applicant relate to a compensable cause. However, the First Respondent contends that this needs to be considered in circumstances where:
    1. A “compensable cause” is itself defined by the Contract to include, relevantly, an act, default or omission of the principal.
    2. Variation 60 was described by the Applicant as “principal caused delay damages”. The Applicant’s case was that the alleged delays were caused by the principal. The logical starting point of the consideration of the claim would be whether the claims related to a “compensable cause” being principal caused delays consequent to the way the Applicant framed the claim itself.
  4. [65]
    The First Respondent also contends that in any event, the Third Respondent applied his own process of reasoning to find that clause 34.9 of the Contract only creates an entitlement to delay damages if the EOT is for a compensable cause.
  5. [66]
    The First Respondent points to the following particular parts of the Adjudication Decision:
    1. At [366], the Third Respondent quoted clause 34.9 of the Contract which expressly refers to “an EOT for a compensable cause”.
    2. At [367], the Third Respondent quoted the definition of “compensable cause” and later at [369] found that:

“the only extensions of time for which there is a compensable cause, and therefore a claim for delay damages, are those extensions of time caused by any act, default or omission of the Superintendent, the Principal or its consultants, agents or other contractors (not being employed by the Contractor)”.

  1. At [370], the Third Respondent identified that there were three EOT claims which the Third Respondent had considered were “caused by an act, default or omission of the Superintendent, the principal or its consultants”.
  1. At [371], the Third Respondent determined that there were “24 days of delay, for which there is an extension of time, that result from a compensable cause”.
  1. [67]
    Ultimately, on a reading of the Adjudication Decision the First Respondent submits that the Third Respondent did not accept a submission made by the First Respondent in respect of the 24 days of compensable caused delays. Ultimately, the 24 days allowed by the Third Respondent was based on the adjudicator’s own findings of fact, in respect of the EOT claims which he found to have been caused by a “compensable cause”.
  2. [68]
    The First Respondent relies upon the comments of McMurdo J in Northbuild Construction Sunshine Coast Pty Ltd v Beyfield Pty Ltd:[21]

“to determine an application, an adjudicator must identify the relevant terms of the contract upon which the claim is made and then apply the facts, as he or she finds them to be, to those terms upon their proper interpretation. The identification of the terms and the interpretation of those terms are thereby questions which the adjudicator must answer in the exercise of his jurisdiction …”

  1. [69]
    The First Respondent contends that this is exactly what the Third Respondent did. The Third Respondent identified the relevant clause of the Contract, namely clause 34.9, and applied the terms of that clause to the facts as he found them to be. He did so without “considering” any “new reasons” submitted by the First Respondent.
  2. [70]
    Reference is also made to the New South Wales Court of Appeal decision in The Minister for Commerce v Contrax Plumbing (NSW) Pty Ltd.[22] Relevantly, in that case:
    1. The claimant in its adjudication application submissions asserted that it was entitled to the amount claimed by it under the New South Wales Act as a result of the New South Wales Act rendering certain clauses of the contract relied upon to withhold payment as void.
    2. In the adjudication response, the respondent contended that the claimant was not entitled to rely on s 34 of the New South Wales Act as it had not been raised in the payment claim.
    3. The adjudicator nevertheless considered s 34 of the New South Wales legislation and found that it rendered the relevant parts of the contract void and therefore found largely in favour of the claimant.
    4. On appeal, Hodgson JA, with whom Bryson JA and Brownie AJA agreed, considered the New South Wales Act equivalent of s 88(2) of the BIF Act. In that regard, Hodgson JA observed:[23]

“… it is true that [section 22(2)(d) of the New South Wales equivalent of section 88(2) of the BIF Act] limits the submissions of the respondent that can be considered under that paragraph to submissions duly made by the respondent in support of the payment schedule; and in my opinion, that does have the effect of excluding, from consideration under that paragraph, reasons included in the adjudication response that were not included in the payment schedule.

However, paragraphs (a) and (b) of s 22(2) require the adjudicator to consider the provisions of the Act and the provisions of the construction contract; and in my opinion, that entitles and indeed requires the adjudicator to take into account any considerations (other than considerations arising from facts and circumstances of the particular case not otherwise before him or her) that he or she thinks relevant to the construction of the Act, the construction of the contract, and the validity of terms of the contract having regard to provisions of the Act. Thus, in my opinion, if an adjudicator comes to know of submissions of a respondent that he or she thinks to be relevant to these questions (not being submissions based on facts and circumstances of the particular case not otherwise before him or her), he or she can take them into account under paragraphs (a) and (b), even if they cannot be considered under paragraph (d).”

  1. [71]
    In this regard, the First Respondent contends that this approach makes it clear that an adjudicator is entitled to consider submissions relevant to “the construction of the contract” if he or she “comes to know of submissions” which are “relevant to these questions”. That is, the adjudicator is to consider the provisions of the relevant construction contract. Here, the Third Respondent considered the provisions of the Contract he considered to be applicable and not based on the First Respondent’s submissions.
  2. [72]
    Accordingly, the First Respondent contends that the Third Respondent’s findings in respect of Variation 60 should not be severed from the Adjudication Decision because there has been no jurisdictional error.
  3. [73]
    It is necessary to consider Variation 60 and the response, and then the Payment Claim and Payment Schedule, the Adjudication Application (including the Applicant’s submissions), the Adjudication Response and then ultimately the part of the Adjudication Decision dealing with Variation 60.
  4. [74]
    Variation 60[24] was made on 16 November 2023 and included:
    1. A statement that it was made in accordance with clauses 34.9 and 41.1 of the Contract.
    2. A statement that it was made pursuant to “the below notified Principal Caused delays”, which included listed claims for extensions of time in two categories, “approved”[25] and “disputed”.[26]
    3. Amounts were claimed in respect of each of the listed extension of time claims, with the total amount excluding GST being $418,190.
  1. A statement that the Applicant considered that the Applicant and the First Respondent had agreed damages for principal caused delays on 13 July 2023 in the amount of $140,000, but as the First Respondent did not consider an agreement had been reached the Applicant “submits the delay damages in full for assessment”.
  2. A statement that the delays “resulted in a substantial increase to the project costs and duration, including the … costs for preliminaries and overheads which were protracted”.
  3. Four documents attached to the variation claim, including a “Delay Damages Day Rate Calculation” and the EOT Register.
  1. [75]
    On 1 December 2023 a response to Variation 60[27] was provided by the Superintendent which included as follows:
  1. (a)
    A statement that Variation 60 was “seeking a variation claim purportedly due to delay damages arising from alleged principal caused delays”.
  1. (b)
    Set out the EOTs and amounts claimed, including the total of $418,190 excluding GST.
  1. (c)
    Under the heading “assessment”:
  1. (i)
    Advises that the Superintendent’s assessment is that the claim “is not approved”.
  1. (ii)
    States that the assessment of any damages will be considered “in line with the calculation of liquidated damages upon achievement of practical completion”.
  1. (iii)
    As practical completion has not yet been achieved:
  1. (A)
    the Applicant had no entitlement to the claim for delay damages; and
  1. (B)
    the claim was not capable of being assessed.
  1. [76]
    The Payment Claim[28] was given on 7 December 2023 and was supported by a statutory declaration. The Payment Claim includes a single line item containing information including variation number, date, description, price submitted, price approved, previous amount, current amount and movement amount. Relevantly in respect of Variation Claim 60 the information included is as follows:
    1. Date - 31/10/23
    2. Description – Principal Caused Delay Damages
    3. Price submitted - $140,000.00[29]
    4. Price approved/previous amount/current amount - $418,190.00[30]
  1. Percentage – 100%.
  1. [77]
    On 21 December 2023 the Superintendent provided Payment Certificate #23 and the Payment Schedule, which included as follows:
  1. (a)
    In the Payment Certificate:
  1. (i)
    “Variation 60 has not been approved. Reasons provided in response to VAR 60 dated 1 December 2023”.
  1. (ii)
    The “Adjusted Sum of Claim” – “[negative] 418,900.00”.[31]
  1. (b)
    In the Payment Schedule:
  1. (i)
    Variation: Principal Caused Delay Damages
  1. (ii)
    Claimed: $418,190.00
  1. (iii)
    Approved: “ – “
  1. (c)
    Difference from approved to claimed: “Variation 60 has not been approved. Reasons provided in response to VAR60 dated 1 December 2023.”
  1. [78]
    The Applicant’s submissions included with the Adjudication Application relevantly stated:
    1. “The only reason given for the non-approval … has clearly ceased to have had any relevance whatsoever by the time that the Payment Schedule … was provided on 21 December 2023”.[32]
    2. The response of 1 December 2023 was “merely a ‘holding position’ rather than a substantive reason for withholding payment … as such, the “assessment” was not a valid reason for the withholding of payment”.[33]
    3. As no substantive reason had been provided for the withholding of payment, the Applicant submitted that the Third Respondent “would properly decide the dispute … framed by the Payment Schedule” such that Applicant is entitled to the whole amount claimed.
  2. [79]
    The Adjudication Response dated 12 April 2024:[34]
  1. (a)
    Describes the claim for $418,190 as what the Applicant “describes as variation number 200060”.
  1. (b)
    States “In truth, this claim does not involve a variation within the meaning of the Contract at all. Rather, it is a claim for delay damages for what are alleged to be principal caused delays”.
  1. (c)
    The claim was “rejected” in the Payment Schedule on the basis “that it had not been approved”.
  1. (d)
    Disagrees with the Applicant’s submission that “no substantive reason has been provided for … withholding payment”.
  1. (e)
    Says that the Third Respondent is required to determine the amount to be paid in respect of the claim, and not rubber stamp the amount claimed.
  1. (f)
    Says:
  1. (i)
    The claim is not a variation in the sense of a claim for the value of construction work undertaken. Rather it is a claim for delay damages in respect of “what are said to be principal caused delays”.
  1. (ii)
    Clause 34.9 of the Contract makes the entitlement to delay damages contingent upon an EOT having been granted by the Superintendent.
  1. (iii)
    Clause 34.9 of the Contract states as follows:
  1. “34.9 Delay Damages
  1. For every day the subject of an EOT for a compensable cause and for which the Contractor gives the Superintendent a claim for delay damages pursuant to subclause 41.1, damages certified by the Superintendent under subclause 41.3 shall be due and payable to the Contractor”. (italics in original)
  1. (iv)
    The Variation Claim set out in the letter dated 16 November 2023 sought delay damages in respect of 9 EOT claims, 7 of which had not been granted and are the subject of disputed EOT claims to be determined as part of the Adjudication Application.
  1. (v)
    While possible and sought by the Applicant, it would not be appropriate to find delay damages are payable in respect of EOTs which have not been granted in the absence of a determination by the Third Respondent that the extensions of time ought to have been granted.
  1. (vi)
    This is separately dealt with in submissions in Section 8.8 (being in respect of Disputed EOT Claims).[35]
  1. (vii)
    Even if the Third Respondent determines that an EOT ought to have been granted in respect of the EOT claims, clause 34.9 provides that the Third Respondent must also be satisfied that the alleged delays are from a compensable cause.
  1. (viii)
    Quotes the definition of “compensable clause” in clause 1 of the Contract as “means: (a) any act, default or omission of the Superintendent, the Principal or its consultants, agents or other contractors (not being employed by the Contractor); or (b) those listed in Item 31”. (italics in original)
  1. (ix)
    The submissions in Section 8.8 make it clear that at least some of the EOT claims do not relate to a compensable cause within the defined meaning. Reference is made in a footnote to “including” EOT 10, 34 and 37.
  1. (g)
    In addition, says that even if the Third Respondent determines that the EOTs ought to have been granted and they involve compensable delays, the Third Respondent must be reasonably satisfied that damages to the extent claimed have been incurred. Reference is made to the “scant details” provided and it was hard to see that that the Third Respondent could be satisfied, particularly that the costs were not included in the value of variations approved under the Contract.
  1. (h)
    On the basis of what had been presented the Third Respondent could not be reasonably satisfied on the basis of the “presented” information that the amount claimed is due and payable. The Third Respondent should decide no amount is payable.
  1. [80]
    Whether “new arguments” are raised in the Adjudication Response cannot be determined by a direct comparison of the Payment Schedule and the Adjudication Response. The first is a shorthand response and the latter is a narrative response in the form of submissions.
  2. [81]
    What is required is a consideration of whether the narrative response reflects the scope of the matters raised in the shorthand response in relation to the reasons for withholding payment. That response also is framed by the underlying documents which are included by reference, being (for example) the variation claim and the response and various attachments (sch as the statutory declaration) and also the terms of the contract.
  3. [82]
    This is consistent with the statement of Basten JA in the New South Wales Court of Appeal decision of Coordinated Construction Co Pty Ltd v Climatech (Canberra) Pty Ltd & Ors[36] at [42]:

“… However, as Hodgson JA notes at [25] above, the claim must ‘identify’ the work, goods or services to which the payment sought relates. The term ‘identify’ should be given a purposive construction: what must be done must be sufficient to draw the attention of the principal to the fact that an entitlement to a payment is asserted, arising under the contract to which both the contractor and the principal are parties. In that sense, the claim, to be valid, must be reasonably comprehensible to the other party. If the entitlement does not arise absent the supply of supporting documentation, then the claim must be accompanied by that documentation, unless it has already been provided. On the other hand, it may be that the distinction between a ‘claim’ and a ‘reply’ by way of a payment schedule (see s 14(1)), on the one hand, and ‘submissions’ on the other, suggest that the precise contractual basis for the entitlement may not need to be identified in the claim, nor addressed in the response. Rather, the claim should assert, in full, the factual basis upon which it is made, including the provision of documents where necessary, whereas the reliance on a relevant contractual provision may be dealt with by way of submissions, if the matter comes before an adjudicator. It would then follow that the requirement in s 20(2B) that the ‘reasons’ for withholding payment must be limited to those identified in the payment schedule, would not preclude the principal from undertaking the same exercise it its submissions, namely the identification of the absence of justification in terms of specific contractual provisions.”

  1. [83]
    Looking at the scope of what is in issue between the parties:
  1. (a)
    It is clear that the Applicant made the claim on the basis of clauses 34.9 and 41.1 of the Contract. There can be no “new argument” by the inclusion of those contractual provisions as that was articulated from the outset.
  1. (b)
    Further, the characterisation of the claim as being for “principal caused delay damages” was the basis of the Applicant’s claim from the outset and is also consistent with the contractual provisions relied upon. This is also consistently referred to in the Applicant’s material.
  1. (c)
    Whilst the claim is made in the form of a “variation”, the Applicant does not purport to bring the claim pursuant to clause 36 of the Contract, being in respect of variations to the work under the Contract. That is also consistent with the reference to clauses 34.9 and 41.1 of the Contract.
  1. (d)
    The variation claim identifies the relevant EOTs and from the outset at least some of them were recognised as “disputed”. The Claim incorporates the EOT Register so the status of those claims was in effect put in issue in respect of the claim.
  1. (e)
    The variation claim on its face states that the claim is made “for assessment”, which is consistent with an evaluative exercise being required in respect of the amount claimed.[37]
  1. (f)
    The Superintendent’s response dated 1 December 2023 can be understood to be that:
  1. (i)
    The variation claim purportedly sought delay damages.
  1. (ii)
    The delay damages are to be assessed as part of the exercise of calculating liquidated damages after practical completion has been achieved.
  1. (iii)
    There was no basis for a claim for delay damages until practical completion was achieved.
  1. (iv)
    It was only after practical completion was achieved could the claim be assessed.
  1. [84]
    Properly understood in the context of the Contract, the relevant “assessment” was the exercise to be undertaken pursuant to clause 34.9 of the Contract. Logically, the claim is framed by operation of the relevant contractual provisions.
  2. [85]
    By virtue of the provisions in the Contract regarding liquidated damages and the date of practical completion, part of that assessment was calculating the date for practical completion following consideration of the claims for extensions of time. It was only once the comparison between the date for practical completion and the date of practical completion could be undertaken that the calculation of liquidated damages could occur. And that was the stage at which the claim for delay damages could be assessed in accordance with the requirements of clause 34.9 of the Contract.
  1. [86]
    Further, by its express terms clause 34.9 raised as part of the contractual framework the issue of “compensable cause” and the definition in clause 1. Logically, the dispute between the parties included the assessment of the entitlement to delay damages, including the consideration of whether the claimed delay was “for a compensable cause”.
  2. [87]
    Logically also the status and assessment of the claims for extensions of time are incorporated into the Variation Claim. This starts with the inclusion of the EOT Register by the Applicant in the Variation Claim.
  3. [88]
    It is also relevant that the prohibition on “new reasons” is in relation to “new reasons for withholding payment”. It is not a prohibition on a submission that more fully articulates the existing reasons for withholding payment identified in the Payment Schedule.
  4. [89]
    The Applicant’s contention appears to be that the reason for withholding payment was no more than “not now”. As the date of practical completion had been reached by the time of the Payment Schedule, it is submitted that resulted in there being no reason of substance to withhold payment. That view is too simplistic and fails to give weight to the matters raised in the “assessment” of the claim which clearly fell within the scope of the dispute between the parties.
  5. [90]
    Here, the reasons for withholding payment identified in the Payment Schedule are:
    1. This was a variation claim that purported to claim delay damages. It was not, in fact, a variation under the Contract. The claim was refused.
    2. Delay damages are to be assessed as part of the calculation of liquidated damages. In the context of relevant provisions of the Contract that was when the date for practical completion and the date of practical completion were known.
    3. Entitlement did not arise until after practical completion.
  6. [91]
    Put simply, the reasons for withholding payment went to both entitlement and quantum under the terms of the Contract in the context of clause 34.9 pursuant to which the claim was made by the Applicant.
  7. [92]
    The submissions made in the First Respondent’s Adjudication Response were consistent with these grounds for withholding payment. The submissions expanded the discussion and application of the relevant contractual provisions in line with these grounds.
  8. [93]
    Accordingly, I find that the First Respondent did not include “new reasons for withholding payment” in the Adjudication Response contrary to s 82 of the BIF Act.
  9. [94]
    If, however,[38] the First Respondent did include “new reasons for withholding payment” in the Adjudication Response contrary to s 82, the question arises as to whether the Third Respondent considered those “new reasons” for withholding payment in the Adjudication Decision.
  1. [95]
    The Applicant’s submissions on this second aspect do not substantially engage with what is practically required to constitute considering “new reasons” and also what the Third Respondent did in the Adjudication Decision.
  2. [96]
    It cannot be that merely reading or making a passing reference to a “new reason” for withholding payment is sufficient to be a contravention of s 88(3)(b) of the BIF Act. That would expose an adjudicator to being in effect “set up” to contravene the legislative provision by merely being provided with a document containing a “new reason” and reading it.
  3. [97]
    Section 82(5) of the BIF Act provides that an adjudicator may require a respondent to resubmit an adjudication response without the new reasons. This is consistent with Parliament intending that mere receipt or reading of “new reasons” would not be a contravention. Where appropriate a new document could be provided excising the offending parts. Alternatively, pursuant to s 88(3) of the BIF Act the offending parts would not be “considered”.
  4. [98]
    The submissions of the First Respondent in respect of what the authorities say constitutes considering “new reasons” are of assistance. I agree with the analysis of the authorities that to “consider” requires an active intellectual process and a process of evaluation sufficient to warrant the description.
  5. [99]
    The Applicant seeks to make the statement at [365] of the Adjudication Decision evidence of the Third Respondent considering “new reasons” as it refers to the submissions “extend[ing] the reasons”. But this is not logical. While the Third Respondent does say that in the Adjudication Decision, it did not in fact extend the reasons. The Applicant had always made the claim pursuant to clause 34.9 as outlined above. Further, the Superintendent’s response incorporated in the Payment Schedule, refers to it being a variation purportedly for delay damages. This is also consistent with the claim not being a variation claim for a change in the scope of the works.
  6. [100]
    Here it is clear that the Third Respondent had read the First Respondent’s Adjudication Response. However, there is only one passing reference to them at [365]. On the wording of the relevant part of the Adjudication Decision, the Third Respondent went to clause 34.9 of the Contract under which the claim was made and then undertook as assessment in light of his findings in respect of the relevant extensions of time. He then applied the number of days he calculated to the rates claimed.
  7. [101]
    In effect the Third Respondent did not adopt the First Respondent’s submissions as the submissions contended for a nil payment. By finding as he did, the Third Respondent undertook the assessment task in accordance with the Contract and the claim for an “assessment” which was made by the Applicant in the initial variation claim.
  8. [102]
    The Adjudication Decision does not evidence that the Third Respondent engaged with the First Respondent’s Adjudication Response. He did the assessment as required by him under the BIF Act in respect of the claim made by the Applicant in Variation 60.
  9. [103]
    The Third Respondent did engage with the definition of compensable clause but again that was raised by the Applicant by the incorporation of clause 34.9 of the Contract.
  1. [104]
    Overall, I accept the First Respondent’s submission that the Third Respondent did not engage in an active intellectual process and a process of evaluation sufficient to warrant the description of the Third Respondent considering the First Respondent’s Adjudication Response (if they did amount to “new reasons for withholding payment”).
  2. [105]
    There are two further issues that need to be considered.
  3. [106]
    Bond J in Acciona Agua Australia Pty Ltd v Monadelphous Engineering Pty Ltd[39]at [66] stated:

“Monadelphous submitted that even if the new reasons could be regarded as not duly made, they could be regarded as properly before the adjudicator by reason of s 88(2)(b), which is the provision which requires the adjudicator to consider, amongst other things, “the provisions of the relevant construction contract”. On this basis, Monadelphous contended, the submissions as to the two alternative bases were to be considered because they asserted the significance of implied terms to the contract. I reject this submission. The specific prohibition to which I have referred must be taken to apply in preference to the general enabling terms to which Monadelphous refers.”

  1. [107]
    This statement can be distinguished here, as the Adjudication Response if it is properly characterised as “new reasons for withholding payment” in respect of Variation 60 was not actually considered by the Third Respondent in the sense outlined above. The Third Respondent did not engage with the submissions made by the First Respondent but proceeded with the task of considering the relevant provision of the Contract.[40]
  2. [108]
    The Applicant relies on the New South Wales Court of Appeal decision in Ceerose Pty Ltd v A-Civil Aust Pty Ltd[41] where Payne JA (with whom Ward ACJ and Basten AJA agreed) stated including as follows:
  1. “[75]
    …. Certainly, it is not a jurisdictional error for an adjudicator, having decided all the reasons advanced by the respondent were invalid, to then and without more, determine the amount of the progress payment in favour of the claimant based on the payment claim.
  1. [76]
    This is because, in addition to s 22(2), which provides a limit on what an adjudication is obliged to take into account, sub-section 14(3) requires that where a payment schedule indicates an amount of a payment which is less than the amount of the claim, the schedule must indicate why the amount is less and, if a respondent is withholding payment, the reason for that action. The recipient of the payment claim is obliged to explain the reason why the payment claim (or any part of it) is disputed. Where the payment schedule indicates an amount which is less than the amount claimed, the claimant may apply for adjudication of its payment claim: s 17(1)(a). Where such an application is made, the respondent may lodge a response to the claimant’s adjudication application. That response may contain relevant submissions (s 20(2)(c)), but, as I have said, s 20(2B) provides:
  1. The respondent cannot include in the adjudication response any reasons for withholding payment unless those reasons have already been included in the payment schedule provided to the claimant. (italics added)
  1. [77]
    It is the dispute between the maker of the payment claim and the recipient of that claim which is referred for adjudication. In the light of this express restriction on the contents of the adjudication response, an adjudicator is not required to go beyond the terms of the payment schedule, repeated in an adjudication response, in accepting all or part of the payment claim. The requirement in s 22(1), that the adjudicator is to determine “the amount of the progress payment (if any) to be paid” by the respondent to the claimant, in context, is a requirement to determine the amount of the progress payment arising from the dispute submitted by the parties for adjudication. The notion that it is jurisdictional error for an adjudicator to fail to address what the adjudicator considers to be the “true construction of the contract” and the “true merits of the claim” outside the limited issues presented by the parties for determination is an invitation for the reviewing court to embark on an impermissible merits review.”
  1. [109]
    The Applicant’s submissions put this as high as an adjudicator never asks what are the entitlements under the contract but merely is to ask what is the “battle set out by the payment claim and the payment schedule”.
  2. [110]
    The practical effect of this submission is that:
    1. An adjudicator does not have to consider the merits of any claim if the reasons put forward in a payment schedule are rejected.
    2. It would not be jurisdictional error for the adjudicator not to consider the claim on the merits and could just accept the claim in a payment claim.
  3. [111]
    In Ceerose Pty Ltd v A-Civil Aust Pty Ltd the Court held that it was not a jurisdictional error for an adjudicator to fail to consider a matter outside of the scope of the dispute presented by the parties in the payment claim and payment schedule as required by the statute. That is, the absence of material, including a reason put forward by a respondent for nonpayment, entitled an adjudicator to award the amount of the claim without addressing the merits.
  4. [112]
    However, that does not mean the adjudicator is obliged to award the amount claimed without considering the contract and the merits. The decision does not in effect mean that the adjudicator must “rubber stamp” the claim if reasons in a payment schedule fall away.
  1. [113]
    In Acciona Agua Australia Pty Ltd v Monadelphous Engineering Pty Ltd[42] Bond J defined the statutory task at [35]:

“Second, the valid exercise of an adjudicator’s jurisdiction is conditioned on the adjudicator having arrived at his or her conclusion by a process which considers the matters set out in s 88(2) of the Payment Act. But as to this, the following important matters must be noted:

  1. The valid exercise of an adjudicator’s jurisdiction is not conditioned on the adjudicator reaching what is objectively the correct conclusion on all of the questions of fact or law required by the consideration of the matters set out in s 88(2). Or, to put it another way, there are many errors of fact and law which might be made by an adjudicator which would not be regarded as going to jurisdiction.
  2. On an application to set aside an adjudicator’s decision for jurisdictional error, the question is not whether the Court would have come to the same conclusion as the adjudicator. Rather, the question is whether the adjudicator arrived at his or her conclusion by a process which failed to consider the matters set out in s 88(2).[43]
  3. This point was succinctly made in Northbuild Construction Sunshine Coast Pty Ltd v Beyfield Pty Ltd [2015] 1 Qd R 463 at [29], where McMurdo J pointed out (footnotes in original):

To determine an application, an adjudicator must identify the relevant terms of the contract upon which the claim is made and then apply the facts, as he or she finds them to be, to those terms upon their proper interpretation. The identification of the terms and the interpretation of those terms are thereby questions which the adjudicator must answer in the exercise of his jurisdiction. It follows that an error in the identification of the terms or in their interpretation will not be a jurisdictional error: Coordinated Construction Co Pty Ltd v JM Hargreaves (NSW) Pty Ltd; Clyde Bergemann Senior Thermal Pty Ltd v Varley Power Services Pty Ltd; BM Alliance Coal Operations Pty Ltd v BGC Contracting Pty Ltd.

  1. His Honour distinguished between that sort of error – which was not jurisdictional error – and that which was, in the following passage:

However, where it appears that an adjudicator is not meaning to apply the contract, as he or she interprets it, but is instead allowing the claim upon some other basis, the position is different, because the adjudicator is thereby misunderstanding the scope of the adjudicator’s jurisdiction.

  1. 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.[44]”
  1. [114]
    Consistent with this analysis, the Third Respondent’s consideration of the relevant clause of the Contact was not a jurisdictional error but was the process provided for in s 88(2) of the BIF Act. Further, the assessment undertaken was the subject of the Applicant’s initial claim and was the contest between the parties.
  2. [115]
    In these circumstances, the Applicant has not established jurisdictional error in respect of the Third Respondent’s decision in respect of Variation 60.

Variation 62 – did the Third Respondent consider matters outside the limited matters listed in s 88(2) of the BIF Act or alternatively substantially breach natural justice by considering the Leave Act and the QBCC Act?

  1. [116]
    The issue in respect of Variation 62, is whether by the Third Respondent considering the Leave Act and Part 5 of the QBCC Act did the Third Respondent consider matters outside the limited matters listed in s 88(2) of the BIF Act. If the answer to that question is no, there is a second question issue that needs to be considered.
  2. [117]
    The second issue is whether by the Third Respondent considering the Leave Act and Part 5 of the QBCC Act in making the relevant part of the Adjudication Decision, deny the Applicant natural justice. And if so, was there a realistic possibility that the Third Respondent would have reached a different decision if the Applicant had the opportunity to put in further evidence and/or submissions.
  3. [118]
    Dealing with these issues in turn.
  4. [119]
    The Third Respondent deals with Variation 62 at pages 17 to 19 of the Adjudication Decision.[45]
  5. [120]
    The variation claim is in relation to a claim by the Applicant that it was required to pay additional amounts for the QLeave levy and the QBCC Home Warranty Insurance premium. The Applicant contended that to the extent it was liable for those payments, it was entitled to payment from the First Respondent. The First Respondent disputed any liability.
  1. [121]
    It is not in dispute between the parties that:
    1. The QLeave levy and the QBCC Home Warranty Insurance premium were both caught by the works and both payable.
    2. Pursuant to Appendix F of the Contract, the contractual responsibility for payment of the QLeave levy and the insurance premium rested with the Applicant.

This was acknowledged at [78] of the Adjudication Decision.

  1. [122]
    The Leave Act deals with the payment of levies for building and construction work. Relevantly, s 78 provides that the rate of the levy is to be determined by regulation. Further, s 75 provides that it must be paid “before a development permit that authorises building work (i.e. a building approval) or before the work is started”.
  2. [123]
    Neither the Applicant nor the First Respondent raised the provisions of the Leave Act in the Payment Claim, the Payment Schedule, the Adjudication Application or the Adjudication Response. This is also expressly agreed in the agreed facts set out above.
  3. [124]
    In respect of the Home Warranty Insurance premium, Part 5 of the QBCC Act is relevant. Section 68B(2) of the QBCC Act provides that the premium is payable within 10 days of the contract being concluded and, in any case, prior to construction work commencing. If the work is varied so that the value changes by $5,000 or more, the contractor must pay an additional premium.
  4. [125]
    Again, neither the Applicant nor the First Respondent raised Part 5 of the QBCC Act in the Payment Claim, the Payment Schedule, the Adjudication Application or the Adjudication Response. Again, this is also expressly agreed in the agreed facts set out above.
  5. [126]
    Generally, the amount of the QLeave levy and the amount of the Home Warranty Insurance premium increases when the value of work also increases. The Applicant contends that:
    1. Logically, where the Superintended directs a variation in accordance with clause 36 of the Contract, then the contractor is entitled to submit a claim for the increased value of the QLeave levy and the QBCC insurance premium.[46]
    2. Here there were findings that certain variations were payable.[47]
  6. [127]
    However, the First Respondent maintained that no amount was payable in respect of the QLeave levy because “assessment cannot be completed until practice completion has been achieved as the adjustments are calculated on the final contract sum; and the contractor has no entitlement to such a claim”.
  7. [128]
    The Third Respondent did acknowledge at [83] of the Adjudication Decision that an entitlement arose when a variation was approved for the purposes of clause 36.1 of the Contact. The Applicant submits that this conclusion was correct.
  1. [129]
    The Third Respondent also dismissed the contention raised by the First Respondent that any assessment could only be concluded on practical completion. The Applicant again submits that this conclusion was correct. That is, the amount payable is not linked to the date of practical completion.
  2. [130]
    The Third Respondent went on to hold at [86] that the “trigger” for any payment in relation to the QLeave levy was a written notice from the authority pursuant to s 80(6) of the Leave Act. The Third Respondent noted that the Applicant had not provided a copy of the notice nor given any evidence of an additional levy payment that had been made. Rather, the Applicant had provided a screenshot of a levy calculator from which it derived the anticipated value of the levy.
  3. [131]
    Ultimately, the Third Respondent found that the amount was not payable either because no notice had issued, or no payment had been made. The Applicant contends that this conclusion resulted from reliance on matters that were impermissible. The references to the relevant provisions of the Leave Act form no part of the Payment Schedule and are not part of the dispute between the Applicant and the First Respondent.
  4. [132]
    The Applicant also relies upon s 82(4) of the BIF Act which stipulates that any adjudication response may not include any reasons for withholding payment that were not included in the payment schedule. Further to this, s 88(3) provides that such reasons must not be considered by the adjudicator.
  5. [133]
    In this regard, the Applicant relies upon the observations of Sacker J as to the purpose for legislative provisions as set out in State Water Corporation v Civil Team Engineering.[48] As part of that consideration, Sacker J referred to the decision of Multiplex Constructions v Luikens[49] where Palmer J stated:

“It would be entirely inimical to the quick and efficient adjudication of disputes which the scheme of the Act envisages if a respondent were able to reject a payment claim, serve a payment schedule which said nothing except that the claim was rejected, and then ‘ambush’ the claimant …”

  1. [134]
    Further, the Applicant submits that the authorities indicate that an adjudicator should only have reference to arguments which are agitated by the parties. The arguments raised by the First Respondent are set out at [84] of the Adjudication Decision and were ultimately dismissed by the Third Respondent.
  2. [135]
    The Applicant contends that the Third Respondent raised two arguments of his own, namely that:
    1. There was no proof that the authority had issued a notice for the QLeave levy pursuant to s 80(c) of the Leave Act; and
    2. There was no evidence that the monies had, in fact, been paid.
  3. [136]
    It is in these circumstances, that the Applicant submits that this reasoning of the Third Respondent was unfair. The Third Respondent had not given notice to the parties and the Applicant was denied the opportunity to either provide any notice from the authority or alternatively, to show that the payment had been made.
  1. [137]
    Further, the Applicant contends that it is not clear that liability under the Contract is contingent on either of those matters.
  2. [138]
    Accordingly, unless and until declared invalid, the decision in respect of Variation 62 has force and effect and precludes the Applicant from pursuing Variation 62 in a further payment claim. Accordingly, the Applicant contends that the Adjudication Decision in respect of Variation 62 should be declared invalid and pursuant to s 101(4)(a) of the BIF Act, identified as affected by jurisdictional error.
  3. [139]
    The First Respondent’s position is that in the Adjudication Response the First Respondent disputed the Applicant’s entitlement on the basis of lack of contractual entitlement to the claim and a lack of evidence that the additional amounts claimed had, in fact, been incurred or paid by the applicant.
  4. [140]
    In the Adjudication Decision, the Third Respondent undertook the following approach:[50]
    1. At [77]: responsibility for payment of both the QLeave levy and the QBCC Home Warranty Insurance premium rested with the Applicant.
    2. At [79] and [80]: in accordance with s 75(1) of the Leave Act, the payment of the levy must be made either before a development permit that authorises building work is issued or before the work is started. Further, an additional levy must be paid in accordance with s 80(6) if the levy payable for the actual cost of carrying out the work is more than the levy that has been paid.
    3. At [80] and [82]: in accordance with s 68B(2) of the QBCC Act payment of the QBCC Home Warranty Insurance premium must be within 10 business days after the contract was entered into and prior to the construction work commencing. Additionally, in accordance with ss 70(1) and (2), if the construction work is varied and the value will change by $5,000 or more then the contractor must pay an additional insurance premium for the work prior to any work relating to the variation starts.
    4. At [83]: both the value of the QLeave levy and the QBCC Home Warranty Insurance premium was subject to change should the contract sum increase or decrease.
    5. At [87] and [88]: the “trigger” for payment of any additional QLeave levy is found in s 80(6) of the Leave Act which provides that payment of an additional levy is required upon the receipt of a written notice from the authority. The adjudicator found that the Applicant had not provided this notice nor evidence that any additional levy had been paid. The Third Respondent, therefore, found that the applicant had no entitlement to the amount claimed in respect to the QLeave levy.[51]
    6. At [89] to [94]: the “trigger” for the payment of the QBCC Home Warranty Insurance premium is different and arises when the works under the contract vary by $5,000 or more. There is no need for an authority to provide a specific notice. Accordingly, the Third Respondent found that the Applicant was entitled to payment in respect of the premium because the contract sum had increased by more than $5,000.
  1. [141]
    The Applicant’s challenge to Variation 62 is that the Third Respondent placed reliance on the provisions of the Leave Act and the QBCC Act which was impermissible on the basis that the relevant provisions form no part of the Payment Schedule and therefore the dispute.
  2. [142]
    The First Respondent contends that the issue here does not concern “new reasons for withholding payment”. Rather, the First Respondent acknowledges that the First Respondent did not raise the applicability of the Leave Act and the QBCC Act within its Adjudication Response, as they were not referred to in the Payment Schedule.
  3. [143]
    The First Respondent submits that in this situation, what was undertaken by the Third Respondent was not a consideration of “new reasons for withholding payment” not contained within the Payment Schedule. Rather, the proper characterisation of the Adjudication Decision is that by the Third Respondent relying upon the relevant provisions of the Leave Act and the QBCC Act, the Third Respondent denied the Applicant procedural fairness because the Third Respondent came to the determination on grounds for which neither party has contended.
  4. [144]
    In this regard, the respondent refers to the comments of McDougall J in Musico v Davenport[52] where his Honour stated at [107] as follows:

“… It may readily be accepted that the Act provides for a somewhat rough and ready way of assessing a builder’s entitlement to progress claims. It may also be accepted that the procedure is intended not only to be swift, but also to be carried out with the minimum amount of formality and expense. Nonetheless, what an adjudicator is required to do is to decide the dispute between the parties. Under the scheme of the Act, that dispute is advanced by the parties through their adjudication application and adjudication response … If an adjudicator is minded to come to a particular determination on a particular ground for which neither party has contended then, in my opinion, the requirements of natural justice require the adjudicator to give the parties notice of that intention so that they may put submissions on it …”

  1. [145]
    This approach has been confirmed in Queensland by Applegarth J in Ingeteam Australia Pty Ltd v Susan River Solar Pty Limited & Ors,[53] where his Honour considered decisions of the High Court that a denial of natural justice will occur when an adjudicator decides a dispute on a basis for which neither party has contended.
  2. [146]
    In that case, Applegarth J also found that the Court must also be satisfied that “had procedural fairness been accorded, there is at least a realistic possibility that the adjudicator would have made a different decision”.[54]
  1. [147]
    The First Respondent contends that this requirement does reflect the general law proposition that Parliament intends errors to be jurisdictional only if they are material.[55]
  2. [148]
    In this regard, the First Respondent submits that the issues of onus and the requisite standard of materiality have been settled by the High Court and the following propositions apply:[56]
    1. Materiality is ordinarily a necessary condition of jurisdictional error.
    2. The onus of establishing materiality is on the person asserting jurisdictional error.
    3. The standard of materiality directs attention to whether the decision “could realistically have been different”, not whether it would have been different.
  3. [149]
    Whilst neither party raised the relevant provisions of the Leave Act and the QBCC Act, the Third Respondent’s reasoning does focus on the entitlement under the specific provisions of the Leave Act and the QBCC Act. The question of materiality still needs to be considered.
  4. [150]
    The First Respondent submits that the Applicant appears to concede that the Third Respondent’s findings in respect of the QBCC Home Warranty Insurance premium were correct.
  5. [151]
    Further, the onus is on the Applicant to satisfy the Court that had it had an opportunity to lead further evidence and/or make further submissions, there is a realistic possibility that the adjudicator would have made a different decision.
  6. [152]
    The First Respondent contends that the Applicant’s submissions do not really address the materiality issue and no evidence was led that the Applicant had in fact received the “written notice from the authority” or that the additional levy had in fact been paid.
  7. [153]
    Further, the Applicant fails to explain what further submission it would have made to the Third Respondent such that this Court could find that “there is at least a realistic possibility that the adjudicator would have made a different decision”. It is contended that there is no obvious error in the Third Respondent’s reasoning about which a further submission could have been made.
  8. [154]
    The Applicant’s complaint is in respect of both the Leave Act and the QBCC Act. However, in relation to the QBCC Home Warranty Insurance premium, the Applicant’s position appears to be that the adjudicator’s findings in that regard were correct.
  9. [155]
    Accordingly, the First Respondent contends that the Third Respondent’s findings in respect of Variation 62 should not be severed from the Adjudication Decision because any jurisdictional error that has been committed by him was not material.
  1. [156]
    It is not contentious that the parties did not refer to the Leave Act and the QBCC Act.[57] Further, it is clear that the Third Respondent did refer to the Leave Act and the QBCC Act and relied on the legislative provisions as a key part of his reasoning.
  2. [157]
    The authorities do support the proposition that an adjudicator may have recourse to material in relation to construction of the contract. However, the consideration of legislation not referred to by the parties is in a different category.
  3. [158]
    While the legislation may have been relevant, being the “source” of the QLeave levy and Home Warranty Insurance premium and understood by those in the construction industry as being so, it was not within the matters specified in s 88(2) of the BIF Act as being the “only” matters that an adjudicator may have regard to.
  4. [159]
    Properly characterised the Leave Act and QBCC Act were outside the limitation imposed by s 88(2) of the BIF Act and accordingly, by the Third Respondent considering them and making them a key part of the Adjudication Decision, s 88(2) of the BIF Act has been contravened.
  5. [160]
    In addition, the Third Respondent did make the part of the Adjudication Decision dealing with Variation 62 on bases that neither party contended for, which denied the Applicant natural justice.
  6. [161]
    The First Respondent contends that the onus is then on the Applicant to establish that had the Applicant had an opportunity to lead further evidence and/or make further submissions, there is at least a realistic possibility that the adjudicator would have made a different decision.
  7. [162]
    On the alternative ground of a denial of natural justice, the First Respondent submits that the Applicant has not established the second element. That is, the Applicant has failed to satisfy the Court that had it had an opportunity to lead further evidence and/or make further submissions, there is a realistic possibility that the adjudicator would have made a different decision. Here, other than a general statement by the Applicant that it could have raised something in evidence or submissions, there is no evidence upon which the Court could be satisfied. Accordingly, the alternative substantial breach of natural justice is not established.
  8. [163]
    In respect of Variation 62 the Applicant has established that the Third Respondent in considering the Leave Act and Part 5 of the QBCC Act considered matters outside the limited matters listed in s 88(2) of the BIF Act.
  9. [164]
    The practical effect of the Third Respondent considering the “trigger” for the QLeave levy under the Leave Act and the insurance premium under the QBCC Act was that an additional ground for withholding payment was considered by the Third Respondent which had not been raised in the Payment Schedule.
  10. [165]
    As the valid exercise of the Third Respondent’s jurisdiction was conditioned on:
    1. the adjudicator arriving at his conclusion by a process which considered the matters set out in s 88(2) of the BIF Act; and
  1. the adjudicator having arrived at his conclusion by a process which did not involve consideration of matters prohibited by operation of s 82(4) and s 88(3)(b) of the BIF Act,

by the Third Respondent considering the Leave Act and Part 5 of the QBCC Act, the Third Respondent made a jurisdictional error.

  1. [166]
    Subject to hearing further from the parties as to the form of the declaration and order, it would be appropriate to make a declaration that the relevant part of the Adjudication Decision is void and that it be severed in accordance with s 101(4)(a) of the BIF Act.

Liquidated damages – did the Third Respondent materially deny the applicant natural justice?

  1. [167]
    The issue that arises in respect of liquidated damages is whether in making the relevant part of the Adjudication Decision dealing with liquidated damages, did the Third Respondent deny the Applicant natural justice. And, if so, was there a realistic possibility that the Third Respondent would have reached a different decision if the Applicant had the opportunity to put in further evidence and/or submissions.
  2. [168]
    There are several components to this issue that need to be considered.
  3. [169]
    The First Respondent deducted a total of $772,200 for liquidated damages in the Payment Schedule calculated on the date of practical completion having been certified as 13 December 2023.
  4. [170]
    The Applicant relies upon the comments of Burns J in Ostwald Bros Pty Ltd v Jaylon Pacific Pty Ltd & Ors,[58] namely that:
  1. (a)
    It is for the party claiming liquidated damages to make good its case for liquidated damages at the broad level of persuasion referred to in David Hurst.[59]
  1. (b)
    This exercise requires findings to be made about two things under the Contract, namely:
  1. (i)
    the date of practical completion; and
  1. (ii)
    the date for practical completion.
  1. [171]
    The Applicant also relies upon the definition of practical completion in the contact which states as follows:[60]
  1. “practical completion is that stage in the carrying out and completion of WUC (‘work under the contract’) when:
  1. (a)
    the Works are complete except for minor defects:
  1. (i)
    which do not prevent the Works from being reasonably capable of being used for their stated purpose;
  1. (ii)
    which the Superintendent determines the Contractor has reasonable grounds for not promptly rectifying; and
  1. (iii)
    the rectification of which will not prejudice the convenient use of the Works;
  1. (b)
    those tests which are required by the Contract to be carried out and passed before the Works reach practical completion have been carried out and passed; and
  1. (c)
    documents and other information required under the Contract which, in the Superintendent’s opinion, are essential for the use, operation and maintenance of the Works have boon supplied;” (emphasis original)
  1. [172]
    The difference between the parties is that the Applicant contended that the date of practical completion was 25 October 2023. In contrast, the First Respondent contended that it was 13 December 2023. Ultimately, the Third Respondent found that the date of practical completion was 11 December 2023.[61]
  2. [173]
    The Applicant contends that the conclusion of the Third Respondent evinces jurisdictional error for a number of reasons.
  3. [174]
    First, the Applicant contends that neither party agitated for the date that the on- maintenance letter was issued from the Brisbane City Council as being the date of practical completion. The Third Respondent did not give either party notice that he was considering that date as the date of practical completion.
  4. [175]
    Further, the Third Respondent’s reasoning focused on two issues:
    1. At [356] of the Adjudication Decision, that on 14 November 2023 the Applicant in effect conceded that there was an issue with a stormwater pipes.
    2. At [360] of the Adjudication Decision, that the Development Approval Matrix placed the responsibility of Development Approval Condition 24 (works for stormwater network) wholly on the Applicant.
  5. [176]
    Based on those two factors, the Third Respondent then concluded that the Brisbane City Council did not accept the asset on-maintenance until 11 December 2023 and therefore that the completion of the stormwater pipework failed both parts (a) and (b) of the definition of practical completion.[62]
  6. [177]
    It was in these circumstances that the Third Respondent determined the date of practical completion as 11 December 2023.
  7. [178]
    Relevantly, the Applicant contends:
    1. Neither the Applicant nor the First Respondent contended that the Applicant’s email of 14 November 2023 was a concession that there was an issue with the completion of the stormwater pipe. In contrast, the First Respondent submitted in the Adjudication Response that “the particular items of incomplete work were apparently completed by 14 November 2023”.[63]
  1. If the Third Respondent sought to rely upon the email of 14 November 2023 as showing a concession that the stormwater pipe was not complete, he should have put that to the parties so they could be heard on the matter pursuant to s 84(2)(b) of the BIF Act.[64]
  2. The evidence is that the Applicant did not do any substantial works to complete the stormwater pipe after 25 October 2023.
  3. This is consistent with the fact that a certificate of occupancy was issued for the site on 19 October 2023.[65]
  4. Neither party contended that the Development Approval Matrix placed the responsibility of Development Approval Condition 24 wholly on the Applicant or that by not fulfilling the obligations of that condition that the works could not be deemed practically complete.
  5. The Development Approval Matrix shows that the Third Respondent was erroneous because the matrix did not place responsibility for compliance with Development Approval Condition 24 wholly on the Applicant.
  1. [179]
    Again, if the Third Respondent sought to rely upon the Development Approval Matrix as showing that the works could not have been practically complete until the on- maintenance letter was issued by the Brisbane City Council on 11 December 2023, the Applicant contends he should have put that to the parties so they could be heard on the matter.
  2. [180]
    It is in these circumstances that the Applicant contends that it cannot be said that if the Third Respondent had asked for further submissions on those matters, no submission could have been made to him which might have produced a different result. Accordingly, there was a denial of natural justice in finding that the date of practical completion was 11 December 2023 on a basis for which neither the parties had contended which was substantial.
  3. [181]
    The Applicant also contends that the Third Respondent failed to take account of the fact that the test for practical completion is essentially objective.[66] That is, it is a question of when works were substantially complete. Accordingly, the Third Respondent asked himself the wrong question.
  4. [182]
    In the particular circumstances, the Applicant submits that if the Third Respondent had asked the correct question, namely were the works substantially complete as at 25 October 2023, then the evidence suggested the answer was “yes”.
  5. [183]
    Further, in relation to the date for practical completion, the Third Respondent found that the date was 28 July 2023[67] based on his assessment of the Applicant’s entitlement to the relevant EOT claims.
  1. [184]
    The Applicant contends that at [229] of the Adjudication Decision, the Third Respondent proceeded on the basis that he ignored the parties’ arguments about contractual time-bars and decided instead to make “assessments and determinations
  1. [185]
    Further, the Third Respondent determined EOT Claim 34 on the basis that the civil engineering consultant was novated from the First Respondent to the Applicant. The Applicant submits this is a further contention that neither of the parties had made.
  2. [186]
    Ultimately, it is submitted that the Third Respondent engaged in jurisdictional error where:
    1. contrary to s 88(2) of the BIF Act, the Third Respondent did not confine him to the arguments of the parties in relation to the issue of the date of practical completion;
    2. this was material to EOT Claims 10, 31 and 34; and
    3. further submissions might have persuaded the Third Respondent that the extensions sought should have been granted.
  3. [187]
    The First Respondent submits that it is necessary to undertake a proper analysis of the Third Respondent’s reasoning regarding the date of practical completion. The First Respondent contends that the Third Respondent’s reasoning was as follows:
  1. (a)
    The Third Respondent considered the definition of practical completion in the Contract.
  1. (b)
    The Third Respondent acknowledged that the Applicant contended that the date of practical completion was 25 October 2023 and the First Respondent contended that the date was 13 December 2023.[68]
  1. (c)
    It was the Third Respondent’s role to make his own assessment regarding the date of practical completion, acting reasonably.[69] That is, before the adjudicator finds a date of practical completion other than the date appearing in the certificate of practical completion, the adjudicator must be satisfied, on the basis of evidence, that all the requirements for practical completion were satisfied at the earlier date.[70]
  1. (d)
    The Applicant had received a certificate of occupancy on 19 October 2023.
  1. (e)
    However, the Superintendent advanced reasons that certain works were remaining incomplete as at that date. This included:
  1. (i)
    the stormwater pipeworks which had been identified to be defective, and which the Superintendent had deemed not to be minor;
  1. (ii)
    a noncompliance notice issued by the Brisbane City Council in respect of a fauna spotter; and
  1. (iii)
    a “non-compliant pipe and pipe insulation in the Manly Road reserve”.[71]
  1. (f)
    The certificate of practical completion was issued on 15 December 2023 by the Superintendent, and this was due to “the completion of rectification of the defective stormwater pipe”. That is, the defective stormwater pipe was the main reason for the Superintendent not certifying practical completion.
  1. (g)
    The Third Respondent from that point considered the impact of that defect as it had in effect caused “the largest delay” to the assessment of the works as practically complete.[72]
  1. (h)
    The Third Respondent noted that the Applicant had “conceded” that there was an issue with those works as late as 14 November 2023. This included that a specialist contractor would be employed to rectify those works after that date.
  1. (h)
    The Third Respondent noted that the Applicant had “conceded” that there was an issue with those works as late as 14 November 2023. This included that a specialist contractor would be employed to rectify those works after that date.
  1. (i)
    The Third Respondent also noted the Applicant’s argument that these rectification works could be carried out “during the on-maintenance period and should not prevent the granting of practical completion”.[73]
  1. (j)
    Following a review of the evidence, the Third Respondent:
  1. (i)
    identified that the Brisbane City Council accepted the stormwater asset as “on-maintenance” on 11 December 2023;
  1. (ii)
    found that the stormwater defect had been rectified by that date; and
  1. (iii)
    expressly found rectification of that defect was necessary to achieve the definition of practical competition under the contract. That is both subparagraphs (a) and (b) of the definition of practical completion.[74]
  1. (k)
    Further, the Third Respondent found that by operation of the Development Approval Matrix, which was included with the Contract, the responsibility for Development Approval 24 (being works for stormwater) was “wholly” with the Applicant. This included both the construction of the works and proof of fulfillment as required by a relevant engineer.
  1. (l)
    Ultimately, the Third Respondent found that by not fulfilling this condition until 11 December 2023 when the Brisbane City Council accepted the stormwater asset as “on-maintenance” the Applicant could not have achieved practical completion until that date.[75]
  1. [188]
    The First Respondent relies on this reasoning as showing that the Third Respondent determined the date of practical completion within the “defined area of dispute” referred to him by the parties.[76] In particular:
  1. (a)
    The Third Respondent had regard to the Contract, the dates put forward by each party, the evidence and decided the date of practical completion having regard to those relevant matters.
  1. (b)
    The Third Respondent’s reasons reveal why he rejected the Applicant’s contention that the date of practical completion was 25 October 2023, based on documentary evidence.
  1. (c)
    The Third Respondent’s reasons also reveal why he did not accept the date of practical completion submitted by the First Respondent, being 13 December 2023. This is because it appeared to the adjudicator that there was no reason why the date should not have been certified two days earlier on 11 December 2023.
  1. [189]
    In response to the Applicant’s first contention that the Third Respondent denied the parties natural justice by finding that the date of practical completion was 11 December 2023 rather than the two dates contended by the parties, the First Respondent contends:
  1. (a)
    The Applicant’s complaint does not fairly represent the reasoning process of the Third Respondent in relation to the issue of the date of practical completion.
  1. (b)
    The Third Respondent did not select the date “randomly”.
  1. (c)
    The Third Respondent found the date of 11 December 2023 as it related directly to the reasons why the Superintendent had not certified practical completion until 13 December 2023.
  1. [190]
    Further, the First Respondent submits that the Applicant’s complaint misunderstands the adjudicator’s role. The Third Respondent was not “obliged” to accept either the date proposed by the Applicant, or the date proposed by the First Respondent as the date of practical completion. The BIF Act itself does not require an adjudicator to adopt one position from the positions put forward by the parties.
  2. [191]
    Further, the requirement of procedural fairness does not require an adjudicator to seek submissions from the parties prior to reaching a conclusion which does not involve a complete acceptance of the position put forward by one party or the other. Rather, as the Third Respondent found here, the date of practical completion was within the range of dates expressly put forward by the parties. The Third Respondent reached this date by applying the facts to his interpretation of the definition of practical completion in the Contract.
  3. [192]
    Accordingly, the First Respondent contends that the first ground of jurisdictional error should be rejected.
  4. [193]
    In relation to the Applicant’s second contention relating to the Third Respondent’s finding that the Applicant had “conceded” in its email dated 14 November 2023 that there was an issue with the stormwater pipe and a specialist contractor would be employed to undertake the rectification works, the First Respondent submits that it is necessary to consider the facts in more detail.
  5. [194]
    The Applicant contends that as neither party contended, that the 14 November 2023 email was a concession, if the Third Respondent sought to rely upon the email as showing a concession, that matter should have been put to the parties so they could be heard. The First Respondent submits that this contention should be rejected for the following reasons:
  1. (a)
    There was a “concession” that the stormwater pipe defect existed as was ultimately found by the Third Respondent, taking into account the following:
  1. (i)
    The email of 14 November 2023, which is in evidence, is authored by an officer of the Applicant and states:[77]
  1. “…CMT are awaiting BCC’s endorsement of the recommended methodology for addressing the stormwater. A specialist contractor is ready to commence once CMT confirm endorsements has been issued by the asset owner BCC which as we understand it should be possible during the on-maintenance period and should not prevent the granting of practical completion”.
  1. (ii)
    On the same day, the same officer of the Applicant sent a further email, which is in evidence, which attached a notice expressly stating:[78]
  1. “The Superintendent has further cited as reason for not granting a certificate of practical completion the stormwater defect as identified by CMT Engineers not being rectified. As noted by CMT the rectification methodology has been supplied to council along with all on-maintenance documentation and the rectification of this defect will not inhibit the Principal’s ability to obtain plan sealing with the rectification being able to be completed during the on-maintenance period”.
  1. (iii)
    The statutory declaration before the Third Respondent from the relevant officer of the Applicant also states:
  1. “In relation to the alleged defect with the stormwater line, the [Applicant’s] consultant was waiting on Brisbane City Council’s endorsement of the recommended methodology and a specialist contractor is ready to commence necessary works …”.[79]
  1. (b)
    This is not a matter which could be described as the Third Respondent deciding a dispute on a basis for which neither party has contended in circumstances where:
  1. (i)
    A factual finding was made on the evidence before the Third Respondent.
  1. (ii)
    It is not open to the Court to engage in a merits review with respect to the Third Respondent’s findings on the evidence.[80]
  1. (iii)
    The Third Respondent’s conclusion regarding the date of practical completion was not based upon the concession in the email but followed a detailed analysis of the relevant facts. This included:
  1. “… a detailed recount of the issue, along with the direction to rectify from the Superintendent, the ovality tests from the civil engineer and the retesting that led to the on-maintenance letter”.[81]
  1. (c)
    Even if there had been some denial of procedural fairness the Court would not be satisfied that had procedural fairness been afforded that “there is at least a realistic possibility that the adjudicator would have made a different decision”,[82] particularly as the Third Respondent was correct in concluding that there had been the “concession” by the Applicant.
  1. [195]
    Accordingly, the First Respondent contends that the second alleged ground of jurisdictional error should be rejected.
  2. [196]
    The Applicant’s third contention is that neither party contended that the Development Approval Matrix made the Applicant responsible for Development Approval Condition 24. Further, the Applicant submits that neither party contended that by not fulfilling the obligations of the condition, the works could not be deemed to be practically complete. It is in these circumstances that the Applicant contends that the Third Respondent should have put those matters to the parties so they could be heard on it.
  3. [197]
    The First Respondent points to several reasons why this contention should be rejected, as follows:
    1. The Development Approval Matrix formed part of the Contract and the Third Respondent was entitled to consider the Contract.[83] The Applicant’s complaint that the Third Respondent committed jurisdictional error because he considered a document forming part of the Contract and which he considered relevant to the issue of whether practical completion had been achieved is wrong.
    2. Whilst the First Respondent did not expressly refer to the Development Approval Matrix, the First Respondent did submit in its Adjudication Response that responsibility for the construction of the stormwater pipes was the Applicant’s.[84]
    3. This issue is not properly a matter which could be described as an adjudicator deciding a dispute on a basis for which neither party has contended. The issue is properly characterised as the adjudicator making a finding regarding the requirement of a document that formed part of the Contract. This is within the ambit of the issue that was before the Third Respondent for determination. That is, whether the rectification of the defective stormwater pipe was a matter relevant to the achievement of practical completion, the Superintendent having asserted that it was.
    4. Even if there had in fact been some denial of procedural fairness, this Court should not be satisfied that had procedural fairness been accorded there “is at least a realistic possibility that the adjudicator would have made a different decision”. The Development Approval Matrix by item 24 expressly placed responsibility for the work for the stormwater network, including construction in accordance with the relevant Brisbane Planning Scheme Codes on the Applicant.[85]
  1. [198]
    In respect of the Applicant’s fourth contention that the Third Respondent “asked himself the wrong question” with respect to the issue of whether practical completion had been achieved, the First Respondent refers to the decision of Bond J in Acciona. The First Respondent contends that this type of error was found not to amount to jurisdictional error. Relevantly, Bond J stated as follows:

“The valid exercise of an adjudicator’s jurisdiction is not conditioned on the adjudicator reaching what is objectively the correct conclusion on all of the questions of fact or law required by the consideration of the matters set out in s 88(2). Or, to put it another way, there are many errors of fact and law which might be made by an adjudicator which would not be regarded as going to jurisdiction.”

  1. [199]
    The First Respondent also submits that the position taken by the Applicant in submissions misstates the Third Respondent’s actual findings. In particular, the First Respondent points to [229] of the Adjudication Decision where the Third Respondent stated as follows:

“I also note that there is substantial argument from both parties over the use of time bars contained with the respective requirements to lodge notices of delay, claim an extension of time, undertake an assessment of the claim and the giving of an EOT direction. It is apparent that, throughout the course of the works, neither party have fully complied with the requirements to follow the time requirements of clause 34. Subsequently, I could not make determinations based solely on compliance with time bars. Instead, the below series of assessments and determinations seek to determine an EOT on the basis that there has been an actual delay.”

  1. [200]
    The reference to “time bars” by the Third Respondent is a reference to the consequence of clause 34.5 of the Contract. The Applicant contends that by operation of that clause, for the EOT claims where the Superintendent had not responded to the claim within 28 days, there was a deemed EOT. In response, the First Respondent submitted that the deeming provision did not apply because the relevant EOT claims made by the Applicant had not been submitted in accordance with the terms of the Contract.
  2. [201]
    The finding of the Third Respondent outlined above was in effect that neither party had fully complied with the terms of the Contract. Accordingly, the Third Respondent proceeded on the basis that he could not decide the EOT claims solely by reference to the operation of the deeming provisions. The First Respondent contends that this finding, whether correct or otherwise, was within his jurisdiction to make.
  1. [202]
    Further, the First Respondent contends that it is unclear precisely what jurisdictional error the Applicant contends the Third Respondent has made. It could not be that the Third Respondent did not consider the parties’ submissions. The position taken by the Third Respondent is consistent with the fact that he had actively considered the submissions in respect of the EOT’s and the relevant evidence.
  2. [203]
    Further, the Third Respondent did not apply a “blanket approach” to the assessment of EOT claims. Rather, he considered the issue on a claim-by-claim basis. For example, in respect of EOT 06 the adjudicator determined that the claim had not been made in accordance with clause 34.3 of the Contract and accordingly the Superintendent was not bound to the obligation contained within clauses 34.4 and 34.5 of the Contract.
  1. [204]
    The final contention raised by the Applicant is in relation to the complaint that the Third Respondent determined EOT Claim 34 on the basis that the civil engineering consultant was novated from the First Respondent to the Applicant, being a contention that neither of them made. The First Respondent submits that the Applicant does not take this contention further and does not identify the actual significance of this, if any.
  2. [205]
    The First Respondent submits that the Third Respondent did not determine EOT Claim 34 solely on the basis that the civil engineering contract had been novated but rather because the coordination of the relevant works were within the capability and capacity of the Applicant.[86]
  3. [206]
    Accordingly, even if there had been denial of procedural fairness, the First Respondent questions what further submissions the Applicant would have made which, as a realistic possibility, would have caused the Third Respondent to make a different decision.
  4. [207]
    The First Respondent also deals with the “passing reference” to EOT Claims 10 and 31. In response, the First Respondent submits that like EOT Claim 34, in both EOT Claims 10 and 31 the issue of novation of contact was not the sole reason why the Third Respondent rejected those claims.[87]
  1. [208]
    Accordingly, in respect of the claim for liquidated damages, the First Respondent contends that no jurisdictional error has been established.
  2. [209]
    It is necessary to consider each of the issues in turn.
  1. Was there a jurisdictional error by the determination of the date of practical completion as 11 December 2023, rather than 25 October 2023 or 13 December 2023?
  1. [210]
    Issue 1: did the Adjudicator commit a jurisdictional error by determining that the date of practical completion was 11 December 2023, rather than 25 October 2023 or 13 December 2023?
  1. [211]
    On the Applicant’s approach there is a binary choice as to the date of practical completion: the date contended for by the Applicant and the date contended for by the First Respondent. This approach confines the Third Respondent to those options, regardless of the factual finding made by the adjudicator in the process of considering the various claims referred in the Adjudication Application. This approach is at odds with the statutory task and is inconsistent with the authorities.
  2. [212]
    Further, the particular circumstances of this case highlight the difficulty faced by the Third Respondent. The Third Respondent needed to make findings that were relevant to:
    1. the date for practical completion, including a number of contentious extension of time claims; and
    2. the date of practical completion, including the two positions advanced by the parties.
  3. [213]
    The Third Respondent was not assisted by expert detailed delay analysis and the Third Respondent expressly referred to this deficiency in the Adjudication Decision.[88] Consequently, the Third Respondent had to consider the relevant definitions under the Contract and the evidence put forward by the parties and make a finding as to the date of practical completion.
  4. [214]
    Whilst the Applicant and the Respondent put forward dates, the statutory exercise to be undertaken by the Third Respondent was to be satisfied on the evidence when all the requirements for practical completion were met. The dates advanced by the parties set the outer limits on the range to be considered.
  5. [215]
    It is clear from the Adjudication Decision that the Third Respondent engaged with the submissions of the parties, the evidence and the relevant provisions of the Contract. He looked at the incomplete work from the date of the certificate of occupancy on 19 October 2023 and undertook what could be described as a rudimentary delay analysis and identified that the stormwater pipeworks was the “main reason” for the delay in reaching practical completion.
  6. [216]
    The Third Respondent then examined the evidence of both parties and made relevant findings. The date he arrived at was within the parameters of the referred dispute.
  7. [217]
    The Third Respondent’s reasoning is clearly articulated as to why he did not accept the contention of the Applicant but also why he did not accept the date proposed by the First Respondent. The effect of finding the date of practical completion was 11 December 2023 was that the Applicant got the benefit of two days, which would not operate for the calculation of liquidated damages.
  8. [218]
    The ultimate date of practical completion was a logical and reasonable conclusion open from the positions advanced by the parties.
  9. [219]
    The Applicant’s contention of jurisdictional error is founded on the proposition that the Third Respondent must accept one of the two positions propounded by the parties, rather reach a decision within the range identified. The Third Respondent’s task is not so confined in respect of the current issue. It may be that an issue is referred that requires a choice of one of two options and an adjudicator is confined to one or the other. But that is not the case here.
  1. [220]
    The date for practical completion and the date of practical completion are key findings leading to the ultimate claim for liquidated damages. Each component needs to be considered and analysed on the facts and applying the contractual provisions.
  2. [221]
    Here, the finding in respect of the date of practical completion was within the dispute referred to the Third Respondent and the requirements of procedural fairness did not require further submissions to be sought before making that finding. The nature of the date of practical completion and the calculation of liquidated damages required the parties to put forward their position and for the Third Respondent to consider the material relied upon and make findings of fact leading to the ultimate finding of the date of practical completion under the Contract. That is exactly what the Third Respondent did.
  3. [222]
    Accordingly, by determining that the date of practical completion was 11 December 2023, rather than 25 October 2023 or 13 December 2023 the Third Respondent:
    1. Did not make a finding for which neither party had contended, thereby denying the Applicant natural justice.
    2. Made a particular finding open on the evidence before him.
  4. [223]
    Further, if the Third Respondent did deny the Applicant natural justice and had the Applicant had an opportunity to make further submissions to the Third Respondent, on the evidence the Applicant has not established that there is a realistic possibility that the adjudicator would have made a different decision.
  5. [224]
    Accordingly, the first alleged ground of jurisdictional error is not established.
  1. Was there a jurisdictional error by the finding of a “concession”?
  1. [225]
    Issue 2: in respect of the Third Respondent’s finding that the Applicant had “conceded” that there was an issue with the stormwater pipe:
    1. Did the Third Respondent make a finding for which neither party had contended, thereby denying the Applicant natural justice, or did the Third Respondent make a factual finding open on the evidence before him?
    2. If the Third Respondent did deny the Applicant natural justice, had the Applicant had an opportunity to make further submissions to the Third Respondent, is there a realistic possibility that the adjudicator would have made a different decision?
  2. [226]
    Similarly in respect of the second ground of jurisdictional error, it is necessary to consider what the Third Respondent actually did in the Adjudication Decision.
  3. [227]
    The Third Respondent considered documents given to the adjudicator as part of the referred dispute and evaluated that evidence in light of the relevant contractual requirement.
  4. [228]
    The use of the word “concession” should not be considered as being a strict concession in the legal sense. Rather, it can be understood, as evidenced by the reasoning, as being a recognition that the statements made by or on behalf of the Applicant were consistent with there being outstanding work or issues in respect of the stormwater pipeworks.
  1. [229]
    The analysis and assessment to be undertaken by the Third Respondent included considering the evidence relied upon and an evaluation of what was happening in respect of the works under the Contract. This is a retrospective analysis of contemporary documents to piece together what was happening in the relevant period.
  2. [230]
    The statements identified in the correspondence and the statutory declaration do include information which tends to support, and/or is consistent with, there being outstanding work or issues in relation to the stormwater pipeworks. For example, if in fact the works were totally completed there would be no need for contractors to be “ready to commence”.
  3. [231]
    It is also relevant that under the Contract there was physical construction work as well as the provision of various documents as required by the Contract.[89] The latter was also relevant to considerations of the date of practical completion.
  4. [232]
    As set out above, the Third Respondent considered the evidence put froward by the parties and made relevant factual findings. The ultimate finding of the date of practical completion was not solely based on the “concession” but rather resulted from a consideration of all of the evidence.
  5. [233]
    The recognition by the Third Respondent that the statements in the correspondence supported that there was a defect in respect of the stormwater pipe and there was outstanding work at that time, and was open to consideration by the Third Respondent on the face of that evidence. That finding was within the remit of the adjudicator.
  6. [234]
    In these circumstances, the requirement to seek further submissions from the parties before the finding was made did not arise.
  7. [235]
    Further, if the requirement did arise and the finding denied the Applicant natural justice, the evidence does not establish that had the Applicant had an opportunity to make further submissions to the Third Respondent, there is a realistic possibility that the Third Respondent would have made a different decision. The contemporaneous correspondence and the statutory declaration fall to be considered on the face of what is said by and on behalf of the Applicant in those documents. In any event, the Applicant has not put before the Court what the Applicant would have said if given the opportunity.
  8. [236]
    Accordingly, by Third Respondent finding that the Applicant had “conceded” that there was an issue with the stormwater pipe, the Third Respondent:
    1. Did not make a finding for which neither party had contended, thereby denying the Applicant natural justice.
    2. Made a factual finding open on the evidence before him.
  9. [237]
    Further, if the Third Respondent did deny the Applicant natural justice and had the Applicant had an opportunity to make further submissions to the Third Respondent, on the evidence the Applicant has not established that there is a realistic possibility that the adjudicator would have made a different decision.
  1. [238]
    Accordingly, the second alleged ground of jurisdictional error is not established.
  1. Was there a jurisdictional error by the finding on responsibility under the Development Approval Matrix?
  1. [239]
    Issue 3: in respect of the Third Respondent’s finding relating to the Development Approval Matrix:
    1. Did the Third Respondent make a finding for which neither party had contended, thereby denying the Applicant natural justice, or did the Third Respondent make a factual finding open on the evidence before him?
    2. If the Third Respondent did deny the Applicant natural justice, had the Applicant had an opportunity to make further submissions to the Third Respondent, is there a realistic possibility that the adjudicator would have made a different decision?
  2. [240]
    As discussed above, the Third Respondent’s statutory task was to consider the Payment claim, Payment Schedule, Adjudication Application, Adjudication Response and the Contract. The Development Approval Matrix was part of the Contract, including Condition 24. The Third Respondent was entitled to consider the Contract and did so in respect of determining whether practical completion had been met within the definition in the Contract.
  3. [241]
    The Superintendent had declined to find practical completion had been reached at an earlier time. The Third Respondent had to consider the position reached by the Superintendent in light of the evidence and submissions made by the parties and the terms of the Contract.
  4. [242]
    Again, as discussed above this is not a binary decision. There is the date put forward by the Applicant and the date found by the Superintendent, and contended for by the First Respondent. The assessment was whether it was open to be found earlier than the date found by the Superintendent. This included looking at who was responsible for what under the Contract and what needed to be done before practical completion was reached.
  5. [243]
    This was all part of the task of the adjudicator. This included consideration of whether the rectification of the stormwater pipe was relevant to practical completion being reached or not under the relevant provisions in the Contract.
  6. [244]
    The Third Respondent’s consideration of the Development Approval Matrix was consistent with the First Respondent’s contention that the Applicant was responsible for the stormwater pipes under the Contract. That is, item 24 of the Development Approval Matrix places responsibility for the work for the stormwater network on the Applicant, including construction in accordance with the relevant Brisbane Planning Scheme Codes.
  7. [245]
    The recognition by the Third Respondent that the statements in the correspondence supported that there was a defect in respect of the stormwater pipe and there was outstanding work at that time was open on the face of that evidence. That finding was within the remit of the adjudicator.
  1. [246]
    In these circumstances, the requirement to seek further submissions from the parties before the finding was made did not arise.
  2. [247]
    Further, if the requirement did arise and the finding denied the Applicant natural justice, the evidence does not establish that had the Applicant had an opportunity to make further submissions to the Third Respondent, there is a realistic possibility that the Third Respondent would have made a different decision. The Contract was appropriately considered by the Third Respondent. In any event, the Applicant has not put before the Court what the Applicant would have said if given the opportunity.
  3. [248]
    Accordingly, by the Third Respondent’s finding in relation to the Development Approval Matrix, the Third Respondent:
    1. Did not make a finding for which neither party had contended, thereby denying the Applicant natural justice.
    2. Made a factual finding open on the evidence before him.
  4. [249]
    Further, if the Third Respondent did deny the Applicant natural justice and had the Applicant had an opportunity to make further submissions to the Third Respondent, the Applicant has not established a realistic possibility that the adjudicator would have made a different decision.
  5. [250]
    Accordingly, the third alleged ground of jurisdictional error is not established.
  1. Was there a jurisdictional error by the finding in respect of the meaning of “practical completion”?
  1. [251]
    Issue 4: are the Third Respondent’s findings regarding the meaning of “practical completion” (and whether it had been achieved) jurisdictional errors?
  2. [252]
    The Applicant contends that the Third Respondent asked himself the wrong question. This is not established on the reasoning set out in the Adjudication Decision.
  3. [253]
    The reasoning in the Adjudication Decision establishes:
    1. The reasons why the Third Respondent rejected the Applicant’s contention that the date of practical completion was 25 October 2023.
    2. The reasons why the Third Respondent did not accept the date of practical completion submitted by the First Respondent, being 13 December 2023.
  4. [254]
    The finding was based on a detailed consideration of the documentary evidence and the Contract. Ultimately, the Third Respondent applied the facts to his interpretation of the definition of practical completion in the Contract. This is consistent with his statutory task and the dispute referred to the adjudicator.
  5. [255]
    As previously outlined the Third Respondent considered the evidence and submissions of the parties and the relevant provisions of the Contract.
  1. [256]
    Accordingly, by the Third Respondent’s findings regarding the meaning of “practical completion”, and whether it had been achieved, the Third Respondent did not make jurisdictional errors. Errors, if any, would be within jurisdiction.
  2. [257]
    Further, if the Third Respondent did deny the Applicant natural justice and had the Applicant had an opportunity to make further submissions to the Third Respondent, the Applicant has not established a realistic possibility that the adjudicator would have made a different decision.
  3. [258]
    Accordingly, the fourth alleged ground of jurisdictional error is not established.
  1. Was there a jurisdictional error by the finding relating to the EOT claims?
  1. [259]
    Issue 5: in respect of the Third Respondent’s finding in relation to EOT claims:
    1. Did the Third Respondent ignore the parties’ arguments about contractual time bars?
    2. If the answer to the question (a) is “yes”, did the Third Respondent commit jurisdictional error?
  2. [260]
    The statement at [229] of the Adjudication Decision does not evidence a “blanket approach” by the Third Respondent. Rather, it is a recognition that each claim for an extension of time had to be considered individually and not in a short hand manner by categories, including where the deeming provision was alleged to operate. The particular facts for each claim were then considered by the Third Respondent. The First Respondent’s submissions properly characterise this exercise.
  3. [261]
    If the Third Respondent made any error in the consideration of each claim, then that would not be an error going to jurisdiction consistent with Bond J’s comments in Acciona.
  4. [262]
    Again, as previously outlined the Third Respondent considered the evidence and submissions of the parties and the relevant provisions of the Contract.
  5. [263]
    Accordingly, by the Third Respondent’s findings in relation to the EOT claims the Third Respondent did not “ignore the parties’ arguments about contractual time bars.
  6. [264]
    Further, if the Third Respondent did deny the Applicant natural justice and had the Applicant had an opportunity to make further submissions to the Third Respondent, the Applicant has not established a realistic possibility that the adjudicator would have made a different decision.
  7. [265]
    Accordingly, the fifth alleged ground of jurisdictional error is not established.
  1. Was there a jurisdictional error by the finding thatthe civil engineering consultant contract had been novated?
  1. [266]
    Issue 6: in respect of the Third Respondent’s finding that the civil engineering consultant’s contract had been novated to the Applicant:
    1. Was that finding a denial of natural justice?
    2. Had the Applicant had an opportunity to lead further evidence and/or make further submissions, is there a realistic possibility that the Third Respondent would have made a different decision with respect to EOT Claims 10, 31 and 34?
  1. [267]
    In respect of EOT Claim 34, the Third Respondent’s reasoning in the Adjudication Decision considers whether the coordination of the works was within the “capability and capacity” of the Applicant.[90] The finding that the civil engineering contract had been novated from the First Respondent to the Applicant was not determinative.
  2. [268]
    Accordingly, it could not be said that the novation finding was the sole basis for the decision in respect of EOT Claim 34. To the extent that the factual finding was in error, it was within jurisdiction. To the extent that it was a finding that neither party contended for, it was a denial of natural justice.
  3. [269]
    However, had the Applicant had an opportunity to lead further evidence and/or make further submissions, the Applicant has not established that there a realistic possibility that the Third Respondent would have made a different decision with respect to EOT Claim 34.
  4. [270]
    Similarly in respect of EOT Claims 10 and 31 the novation finding does not appear to have been determinative in the Third Respondent’s reasoning in the Adjudication Decision.[91]
  5. [271]
    To the extent it relied on a finding that neither party contended for, it was a denial of natural justice. Again, had the Applicant had an opportunity to lead further evidence and/or make further submissions, the Applicant has not established that there a realistic possibility that the Third Respondent would have made a different decision with respect to EOT Claims 10 and 31.
  6. [272]
    Accordingly, the sixth alleged ground of jurisdictional error is not established.
  7. [273]
    Overall, in respect of liquidated damages, if the Third Respondent did deny the Applicant natural justice and had the Applicant had an opportunity to make further submissions to the Third Respondent, the Applicant has not established a realistic possibility that the adjudicator would have made a different decision.
  8. [274]
    In all of the circumstances, in respect of the claim for liquidated damages, the Applicant has not established jurisdictional error.

Relief

  1. [275]
    The Applicant relies on the decision in Acciona Agua Australia v Monadelphous Engineering Pty Ltd[92] in respect of severance. Bond J at [78] to [85] in that decision considered s 101(4) of the BIF Act.
  2. [276]
    That section provides that where a Court identifies that one part of a decision is affected by error, it may allow the balance of the decision to remain binding upon the parties. Ultimately in that case his Honour found that where there is a successful challenge to an adjudication and there has been a multiplicity of claims, both positive and negative, the Court may remove the invalid part and calculate the nett affect.
  1. [277]
    Accordingly, the Applicant contends that the Court make declarations that the relevant sections of the Adjudication Decision that are affected by jurisdictional error, make a declaration that the balance of the decision is binding on the parties and calculate the consequential adjudication amount pursuant to s 88(1)(a) of the BIF Act.
  2. [278]
    It is not contentious that s 101(4) of the BIF Act can be utilised to sever any paragraphs of the Adjudication Decision that are found to be affected by jurisdictional error.
  3. [279]
    However, The First Respondent submitted that if the liquidated damages amount was to be severed from the Adjudication Decision it would be necessary for further submissions to be made regarding the “adjudicated sum”.
  4. [280]
    Given the findings set out in these reasons, the Applicant has been successful in respect of the Variation 62 claim but not otherwise.
  5. [281]
    The parties are to agree a form of order reflecting these reasons and provide it to my Associate by 2 October 2024. If orders cannot be agreed the parties are to provide a draft order with their respective positions and a brief explanation of the difference of no more than 2 pages.
  6. [282]
    Once the final orders have been made, I will hear from the parties as to costs.

Footnotes

[1](EOT).

[2]See in particular references to Bond J’s summary of the principles in Acciona Agua Australia Pty Ltd v Monadelphous Engineering Pty Ltd [2020] QSC 133.

[3]Section 88(1) of the BIF Act.

[4]Section 88(5) of the BIF Act.

[5]Document 8, page 294 of Exhibit 1.

[6]Document 20, page 1002 of Exhibit 1.

[7]Paragraph 116(b).

[8]At paragraph 116(c).

[9]At paragraph 116(d).

[10]As defined in clause 1 of the Contract. See also at paragraph 116(e) of the First Respondent’s adjudication response.

[11]At paragraph 116(f).

[12]At paragraphs [366] to [371].

[13]At paragraphs [375] and [376].

[14][2020] QSC 133.

[15]At [36] and [67].

[16]Acciona Agua Australia Pty Ltd v Monadelphous Engineering Pty Ltd [2020] QSC 133 at [35]; Total Lifestyle Windows Pty Ltd v Aniko Constructions Pty Ltd (No 2) [2021] QSC 231 at [88]-[98] (Freeburn J); MTR Corporation (Sydney) NRT Pty Ltd v Thales Australia Ltd [2020] NSWSC 147 at [47] (Stevenson J); and Cockram Construction Ltd v Fulton Hogan Construction Pty Ltd (2018) 97 NSWLR 73 at [41] Meagher JA (with whom Basten JA and Barrett AJA agree).

[17]Acciona Agua Australia Pty Ltd v Monadelphous Engineering Pty Ltd [2020] QSC 133 at [64] and [65].

[18]At [13] of the First Respondents submissions.

[19]Exhibit ‘SMR-07” to the Affidavit of S Roberts at page 396-398.

[20]A copy of Variation Number 60 Claim, Exhibit JMM-102 to the McDermott statutory declaration, being Pages 993 – 994 of Exhibit “SMR-08” to the affidavit of S Roberts.

[21][2015] 1 Qd R 463 at [29] and [30]. These comments were expressly endorsed by Bond J in Acciona at [35].

[22][2005] NSWCA 142.

[23]The Minister for Commerce v Contrax Plumbing (NSW) Pty Ltd [2005] NSWCA 142, at [34] and [35].

[24]Exhibit “JMM-102”, Document 19, page 798 of Exhibit 1.

[25]6 items, EOT Claims 1, 6, 10, 14/15, 31 and 34.

[26]3 items, EOT Claims 37, 38 and 39.

[27]Exhibit “JMM-103”, Document 20, page 800 of Exhibit 1.

[28]Exhibit “SMR-02”, Document 7, page 798 of Exhibit 1

[29]This appears to be the “settlement amount” referred to in Variation Claim 60.

[30]This is the total amount including GST claimed in Variation Claim 60.

[31]This is the total amount claimed in Variation Claim 60.

[32]At [11.4] of Exhibit “SMR-07”, Document 9, at page 395 of Exhibit 1.

[33]At [11.5].

[34]Exhibit “SMR-09”, Document 10, page 450 of Exhibit 1.

[35]Disputed EOT claims included 6, 10, 31, 34, 37, 38 and 39. The Applicant in the Variation had stated EOT 6, 10, 31 and 34 were “approved”.

[36][2005] NSWCA 229.

[37]The difference between the Applicant’s “submitted amount” of $140,000 and the total amount claimed also is consistent with an evaluative exercise being required and that the amount claimed may be more in the nature of a “global claim”.

[38]Contrary to the previous finding.

[39][2020] QSC 133.

[40]Consistent with s 88(2)(b) of the BIF Act and the adjudicator’s task as described by McMurdo J in Northbuild Construction Sunshine Coast Pty Ltd v Beyfield Pty Ltd [2015] 1 Qd R 463 at [29] and [30].

[41][2023] NSWCA 215.

[42][2020] QSC 133.

[43]Queensland Bulk Water Supply Authority v McDonald Keen Group Pty Ltd (in liq) [2010] 2 Qd R 322 at [61] per Holmes JA (with whom Fraser JA agreed); Northbuild Construction Pty Ltd v Central Interior Linings Pty Ltd [2012] 1 Qd R 525 at [96] per White JA.

[44]Laing O’Rourke Australia Construction Pty Ltd v H&M Engineering and Construction Pty Ltd [2010] NSWSC 818 at [34]-[39] per McDougall J, followed by P Lyons J in QCLNG Pipeline Ltd v McConnell Dowell Constructors (Aust) Pty Ltd [2011] QSC 292 at [110]-[123].

[45]Exhibit “SMR-01”, Document 11, page 5111 of Exhibit 1.

[46]At [83] of the Adjudication Decision.

[47]At [218] of the Adjudication Decision.

[48][2013] NSWSC 1879 at [64].

[49][2003] NSWSC 1140 at [67].

[50]Exhibit “SMR-01”, Document 11, page 511 of Exhibit 1.

[51]It could be understood as being at that time.

[52][2003] NSWSC 977.

[53][2024] QSC 30.

[54]At [82].

[55]MZAPC v Minister for Immigration and Border Protection (2021) 95 ALJR 441 at [123], [31]-[41] and [50]-[72].

[56]MZAPC v Minister for Immigration and Border Protection (2021) 95 ALJR 441, Hossain v Minster for Immigration and Border Protection (2018) 264 CLR 123 and Nathanson v Minister for Home Affairs (2022) 403 ALR 398 at [1] and [33].

[57]There was no reference to the statutory provisions or statutory framework. On the facts, there was no basis that it could be argued that the legislation was incorporated or a reference could be inferred.

[58][2016] QSC 240.

[59]At [26], citing McDougall J in David Hurst Constructions Pty Ltd v Durham [2008] NSWSC 318

[60]Exhibit “DDH-01”, Document 4, page 112 of Exhibit 1.

[61]The Applicant contends, on the basis that that was the date that “the on-maintenance letter was issued from Brisbane City Council”. Adjudication Decision at [361] and [362].

[62]At [358] and [359] of the Adjudication Decision.

[63]At [262] of the Adjudication Response. Also see footnote [153]

[64]See also Ostwald Bros Pty Ltd v Jaylon Pacific Pty Ltd & Ors [2016] QSC 240 at [29]-[33] and John Holland Pty Ltd v TAC Pacific [2009] QSC 205 at [59].

[65]At [353] of the Adjudication Decision.

[66]Apart from certain exceptions which are not relevant.

[67]At [361] and [362] of the Adjudication Decision.

[68]At [346] to [349] of the Adjudication Decision.

[69]At [351].

[70]At [259] of the Adjudication Response.

[71]At [353] of the Adjudication Decision.

[72]At [355].

[73]At [356].

[74]At [356] to [359] of the Adjudication Decision.

[75]At [361].

[76]John Holland Pty Ltd v TAC Pacific Pty Ltd & Ors [2009] QSC 205 at [36].

[77]Exhibit “JMM-08”, Document 14, page 775 of Exhibit 1.

[78]Exhibit “JJM-09”, Document 15, page 779 of Exhibit 1.

[79]See paragraph 14(b) of the statutory declaration of Jessie Marie Tompson in affidavit of S Roberts, Exhibit “SMR-08”, Document 12, page 594 of Exhibit 1.

[80]Minister for Immigration and Citizenship v SZJSS [2010] HCA 48 at [30]; Ceerose Pty Ltd v A-Civil Aust Pty Ltd [2023] NSWCA 215 at [58].

[81]At [357] of the Adjudication Decision.

[82]Ingeteam Australia Pty Ltd v Susan River Solar Pty Limited & Ors [2024] QSC 30 at [82].

[83]Northbuild at [29], Acciona at [35], Insite Construction Services Pty Ltd v Daniels Civil Pty Ltd & Anor [2023] QSC 33 at [80] and Iris Broadbeach Business Pty Ltd v Descon Group Australia Pty Ltd & Anor [2024] QSC 16 at [66].

[84]At [267] of the Adjudication Response.

[85]The First Respondent acknowledges that the Applicant does make submissions to the contrary.

[86]At [294] to [297] of the Adjudication Decision.

[87]At [259], [261], [285] and [286] of the Adjudication Decision.

[88]At [227] and [228] of the Adjudication Decision.

[89]And/or signoffs.

[90]At [294] to [297] of the Adjudication Decision.

[91]At [259], [261] [285] and [286] of the Adjudication Decision.

[92][2020] QSC 133.

Close

Editorial Notes

  • Published Case Name:

    Paladin Projects Pty Ltd v Visie Three Pty Ltd & Ors

  • Shortened Case Name:

    Paladin Projects Pty Ltd v Visie Three Pty Ltd

  • MNC:

    [2024] QSC 230

  • Court:

    QSC

  • Judge(s):

    Williams J

  • Date:

    25 Sep 2024

  • 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
8 citations
Jump To
Cite 1 - [2020] QSC 133
Cite 2 - [2020] QSC 133
Cite 3 - [2020] QSC 133
Cite 4 - [2020] QSC 133
Cite 5 - [2020] QSC 133
Cite 6 - [2020] QSC 133
Cite 7 - [2020] QSC 133
Cite 8 - [2020] QSC 133
Ceerose Pty Ltd v A-Civil Aust Pty Ltd [2023] NSWCA 215
3 citations
Jump To
Cite 1 - [2023] NSWCA 215
Cite 2 - [2023] NSWCA 215
Cite 3 - [2023] NSWCA 215
Co-ordinated Construction Co Pty Ltd v Climatech (Canberra) Pty Ltd (2005) NSWCA 229
2 citations
Jump To
Cite 1 - (2005) NSWCA 229
Cite 2 - (2005) NSWCA 229
Cockram Construction Ltd v Fulton Hogan Construction Pty Ltd (2018) 97 NSWLR 73
1 citation
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Cite 1 - (2018) 97 NSWLR 73
David Hurst Constructions Pty Ltd v Durham [2008] NSWSC 318
1 citation
Jump To
Cite 1 - [2008] NSWSC 318
Hossain v Minister for Immigration and Border Protection (2018) 264 CLR 123
1 citation
Jump To
Cite 1 - (2018) 264 CLR 123
Ingeteam Australia Pty Ltd v Susan River Solar Pty Ltd [2024] QSC 30
3 citations
Jump To
Cite 1 - [2024] QSC 30
Cite 2 - [2024] QSC 30
Cite 3 - [2024] QSC 30
Insite Construction Services Pty Ltd v Daniels Civil Pty Ltd [2023] QSC 33
1 citation
Jump To
Cite 1 - [2023] QSC 33
Iris Broadbeach Business Pty Ltd v Descon Group Australia Pty Ltd [2024] QSC 16
1 citation
Jump To
Cite 1 - [2024] QSC 16
John Holland Pty Ltd v TAC Pacific Pty Ltd[2010] 1 Qd R 302; [2009] QSC 205
3 citations
Jump To
Cite 1 - [2009] QSC 205
Cite 2 - [2009] QSC 205
Cite 3 - [2009] QSC 205
Laing O'Rourke Australia Construction Pty Ltd v H&M Engineering & Construction Pty Ltd [2010] NSWSC 818
1 citation
Jump To
Cite 1 - [2010] NSWSC 818
Minister for Commerce v Contrax Plumbing (NSW) Pty Ltd [2005] NSWCA 142
3 citations
Jump To
Cite 1 - [2005] NSWCA 142
Cite 2 - [2005] NSWCA 142
Cite 3 - [2005] NSWCA 142
Minister for Immigration and Citizenship v SZJSS [2010] HCA 48
2 citations
Jump To
Cite 1 - [2010] HCA 48
Cite 2 - [2010] HCA 48
MTR Corporation (Sydney) NRT Pty Ltd v Thales Australia Ltd [2020] NSWSC 147
1 citation
Jump To
Cite 1 - [2020] NSWSC 147
Multiplex Constructions Pty Ltd v Luikens [2003] NSWSC 1140
1 citation
Jump To
Cite 1 - [2003] NSWSC 1140
Musico & Ors v Davenport & Ors (2003) NSW SC 977
2 citations
Jump To
Cite 1 - (2003) NSW SC 977
Cite 2 - (2003) NSW SC 977
MZAPC v Minister for Immigration and Border Protection (2021) 95 ALJR 441
3 citations
Jump To
Cite 1 - (2021) 95 ALJR 441
Cite 2 - (2021) 95 ALJR 441
Cite 3 - (2021) 95 ALJR 441
Nathanson v Minister for Home Affairs (2022) 403 ALR 398
1 citation
Jump To
Cite 1 - (2022) 403 ALR 398
Northbuild Construction Pty Ltd v Central Interior Linings Pty Ltd[2012] 1 Qd R 525; [2011] QCA 22
1 citation
Jump To
Cite 1 - [2012] 1 Qd R 525
Northbuild Construction Sunshine Coast Pty Ltd v Beyfield Pty Ltd[2015] 1 Qd R 463; [2014] QSC 80
4 citations
Jump To
Cite 1 - [2015] 1 Qd R 463
Cite 2 - [2015] 1 Qd R 463
Cite 3 - [2015] 1 Qd R 463
Cite 4 - [2015] 1 Qd R 463
Ostwald Bros Pty Ltd v Jaylon Pacific Pty Ltd [2016] QSC 240
3 citations
Jump To
Cite 1 - [2016] QSC 240
Cite 2 - [2016] QSC 240
Cite 3 - [2016] QSC 240
QCLNG Pipeline Pty Ltd v McConnell Dowell Constructors (Aust) Pty Ltd [2011] QSC 292
1 citation
Jump To
Cite 1 - [2011] QSC 292
Queensland Bulk Water Supply Authority v McDonald Keen Group Pty Ltd (in liq)[2010] 2 Qd R 322; [2010] QCA 7
1 citation
Jump To
Cite 1 - [2010] 2 Qd R 322
State Water Corporation v Civil Team Engineering Pty Ltd [2013] NSWSC 1879
1 citation
Jump To
Cite 1 - [2013] NSWSC 1879
Total Lifestyle Windows Pty Ltd v Aniko Constructions Pty Ltd (No. 2) [2021] QSC 231
1 citation
Jump To
Cite 1 - [2021] QSC 231

Cases Citing

No judgments on Queensland Judgments cite this judgment.

1

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