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Ingeteam Australia Pty Ltd v Susan River Solar Pty Ltd[2024] QSC 30

Ingeteam Australia Pty Ltd v Susan River Solar Pty Ltd[2024] QSC 30

SUPREME COURT OF QUEENSLAND

CITATION:

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

PARTIES:

INGETEAM AUSTRALIA PTY LTD ACN 166 870 168

(applicant)

v

SUSAN RIVER SOLAR PTY LIMITED ACN 623 270 673 AS TRUSTEE FOR THE SUSAN RIVER SOLAR TRUST

(first respondent)

AND

DAVID RICHARD BALDRY (ADJUDICATION REGISTRATION NO. J1248299)

(second respondent)

AND

THE ADJUDICATION REGISTRAR, QUEENSLAND BUILDING AND CONSTRUCTION COMMISSION

(third respondent)

AND

PETER JOHN EDWIN ARTHUR (ADJUDICATION REGISTRATION NO. J1246014)

(fourth respondent)

FILE NO:

15583 of 2023

DIVISION:

Trial Division

PROCEEDING:

Application

ORIGINATING COURT:

Supreme Court of Queensland at Brisbane

DELIVERED ON:

8 March 2024

DELIVERED AT:

Brisbane

HEARING DATE:

6 March 2024

JUDGE:

Applegarth J

ORDER:

  1. Pursuant to section 10 of the Civil Proceedings Act 2011 (Qld), or alternatively the inherent jurisdiction of the Court:
  1. declares adjudication decision number 2347766 made by the second respondent on 8 November 2023 void in part for jurisdictional error, namely paragraphs 60, 69(p), 69(q)(1)(iv), 69(q)(4)(ii)- (iv), 69(q)(4)(vii)(2)(c) and 69(q)(4)(vii)(3)-(4) (the licensing findings);
  1. declares that the applicant and the first respondent are not bound by the licensing findings.
  1. The first respondent pay the applicant’s costs of and incidental to this proceeding.
  2. No order as to costs in relation to the second, third and fourth respondents.

CATCHWORDS:

CONTRACTS BUILDING, ENGINEERING AND RELATED CONTRACTS REMUNERATION STATUTORY REGULATION OF ENTITLEMENT TO AND RECOVERY OF PROGRESS PAYMENTS ADJUDICATION OF PAYMENT CLAIMS where an adjudicator found that the applicant had breached licensing requirements in repairing a floor with a piece of plywood for $294 and therefore he did not have jurisdiction to decide a payment claim for $2,385,867 – where the adjudicator did not give the applicant an opportunity to give evidence or make submissions about the floor repair allegation where the applicant did not need a licence to do the minor floor repair – where the adjudicator denied the applicant procedural fairness – whether the adjudicator’s erroneous decision that he did not have jurisdiction because of breaches of licence requirements was a jurisdictional error – whether the error was material to the decision in circumstances in which there was an alternative basis to decline jurisdiction – whether the licensing decision concerns an issue that engages the Dualcorp form of issue estoppel – whether the Court should grant the relief sought by declaring the licensing findings void, and leaving other issues decided by the adjudicator to stand

Building Industry Fairness (Security of Payment) Act 2017 (Qld), ss 42, 68, 70, 75, 84, 88, 101, Chapter 3

Queensland Building and Construction Commission Act 1991 (Qld), s 42, Schedules 1A, 2

Queensland Building and Construction Commission Regulation 2018 (Qld), Items 2, 30, Schedule 1

Acciona Agua Australia Pty Ltd v Monadelphous Engineering Pty Ltd (2020) 4 QR 410, cited

Caltex Refineries (Qld) Pty Ltd v Allstate Access (Australia) Pty Ltd [2014] QSC 223, cited

Cant Contracting Pty Ltd v Casella [2007] 2 Qd R 13, cited

Craig v South Australia (1995) 184 CLR 163, cited

Dualcorp Pty Ltd v Remo Constructions Pty Ltd (2009) 74 NSWLR 190, cited

Fifty Property Investments Pty Ltd v O'Mara [2006] NSWSC 428, cited

Forte Sydney Carlingford Pty Ltd v Li [2022] FCA 1499, cited

Gedeon v Commissioner of the NSW Crime Commission (2008) 236 CLR 120, cited

Hossain v Minister for Immigration and Border Protection (2018) 264 CLR 123, cited

John Holland Pty Ltd v Schneider Electric Buildings Australia Pty Ltd [2010] QSC 159, cited

Karam Group Pty Ltd v HCA Queensland Pty Ltd [2023] QSC 245, cited

Kirk v Industrial Court of New South Wales (2010) 239 CLR 531, cited

Minister for Immigration and Multicultural and Indigenous Affairs v SGLB (2004) 78 ALJR 992, cited

MZAPC v Minister for Immigration and Border Protection (2021) 390 ALR 590, cited

Nathan v Minister for Home Affairs and Another (2022) 403 ALR 398, cited

Olympia Group (NSW) Pty Ltd v Hansen Yuncken Pty Ltd [2011] NSWSC 165, cited

Panel Concepts Pty Ltd v Tomkins Commercial & Industrial Builders Pty Ltd [2021] QDC 322, cited

Probuild Constructions (Aust) Pty Ltd v Shade Systems Pty Ltd (2018) 264 CLR 1, cited

Sanrus Pty Ltd v Monto Coal 2 Pty Ltd (No 4) [2019] QSC 199, cited

St Hilliers Property Pty Ltd v Pronto Solar Innovations Pty Ltd [2019] 2 Qd R 29, cited

Sutton v Zullo Enterprises Pty Ltd [2000] 2 Qd R 196, cited

Thiess Pty Ltd v Warren Brothers Earthmoving Pty Ltd [2013] 2 Qd R 75, cited

Walton Construction (Qld) Pty Ltd v Plumber by Trade Pty Ltd [2012] QSC 264, cited

Walton Construction (Qld) Pty Ltd v Salce & Ors [2008] QSC 235, cited

COUNSEL:

W C LeMass for the applicant

M D Ambrose KC and M Trim for the first respondent

SOLICITORS:

Baker McKenzie for the applicant

Herbert Smith Freehills for the first respondent

  1. [1]
    This big case is about a small bit of wood: a piece of plywood bought at Bunnings.
  1. [2]
    An adjudicator under the Building Industry Fairness (Security of Payment) Act 2017 (Qld) (“BIF Act”) concluded that he did not have jurisdiction to decide a claim for $2,385,867 plus GST because of a claim for $294.24 for repairing a floor in a shed with some plywood. The $294.24 claim was the cost of a handsaw, a piece of plywood, a roll of tape and a small amount of time that a licensed electrician took to tape the piece of plywood to the floor, above a spot that needed repair.
  1. [3]
    The adjudicator concluded, without giving the claimant the chance to call evidence or make submissions on the point, that the claimant required a licence to do that work, and because it did not have the required licence, he did not have jurisdiction.
  1. [4]
    In deciding that the claimant did building work that required a licence and that it could not enforce the multi-million-dollar Operating and Maintenance Contract (“the Contract”), the adjudicator denied the claimant procedural fairness. The first respondent submits the denial of procedural fairness was not material. I disagree. If the adjudicator had given the claimant a chance to respond to allegations made in submissions in reply, he would have been told that the claimant did not need a licence to tape the plywood to the floor. One reason the claimant would have given the adjudicator, had it been given the opportunity to do so, was that laying a “floating floor” (a floor that covers a subfloor, but is not fixed to the subfloor), like laying carpets and laying vinyl, is exempt from the licensing requirements of the Queensland Building and Construction Commission Act 1991 (Qld) (“QBCC Act”).
  1. [5]
    The claimant is aggrieved by the decision that it did unlicensed work and that it therefore cannot enforce the Contract it made with the first respondent. It applies for declarations that the licensing findings in the adjudication decision made by the second respondent on 8 November 2023 are void, and that it and the first respondent are not bound by them. It submits that unless the licensing findings are set aside, a new adjudicator, the fourth respondent, considering a later payment claim with a different reference date, will be bound to reach the same conclusion on the licensing issue, the enforceability of the Contract, and that there is no jurisdiction under the BIF Act to adjudicate a payment claim made by the claimant under the Contract.
  1. [6]
    The fourth respondent, who was joined as a party on 6 March 2024, like the second and third respondents, abides the Court’s decision and played no active role in this proceeding. The fourth respondent (“the new adjudicator”) has been temporarily restrained by an order made by Cooper J on 27 February 2024, and extended by me on 6 March 2024, to not decide that he lacks jurisdiction to decide the adjudication application that has been made to him based on the second respondent’s licensing findings. Statutory time limits are running in that new adjudication process, and the parties request me to decide this application without delay.

The issues

  1. [7]
    The substantial issues are:
  1. Did the adjudicator err in deciding that the claimant should have held a licence to do the floor repair, and therefore he did not have jurisdiction?
  1. Did the adjudicator deny the claimant procedural fairness and thereby make a jurisdictional error that was material to his decision on the licensing issue and his jurisdiction?
  1. If the adjudicator erred in making the licensing decision, was his error a jurisdictional error?
  1. Is the licensing decision material because it engages the Dualcorp[1] form of issue estoppel?
  1. Should the Court grant the relief sought by declaring the licensing findings void, and leaving other issues decided by the adjudicator to stand?

Background

  1. [8]
    The first respondent (“Susan River”) owns a solar farm near Hervey Bay. The applicant (“Ingeteam”) is a licensed electrical contractor that employs qualified and licensed electricians.
  1. [9]
    On 28 September 2020, Susan River and Ingeteam entered into a contract under which Ingeteam was required to operate and maintain the Susan River Solar Farm. Under the Contract, in return for operating and maintaining the Solar Farm, Ingeteam was entitled to an Annual Fee that was payable in equal monthly instalments, to be invoiced quarterly. The Annual Fee was $978,820. In addition, Ingeteam was entitled to charge Susan River for “Additional Services”, namely services that fell outside the scope of the services that were required to be provided by Ingeteam and for which Ingeteam was to be paid the Annual Fee.
  1. [10]
    The Contract came to an end in June 2023, and Ingeteam is pursuing claims under the BIF Act for unpaid amounts.
  1. [11]
    During the term of the Contract, Ingeteam undertook electrical work. Electrical work is not “building work” under the QBCC Act; it is regulated under separate legislation. The extent to which Ingeteam undertook work that was not electrical work (including work for which no licence was required under the QBCC Act) may be a matter for final determination in later proceedings. However, there is no dispute that, on occasions, Ingeteam would engage licensed third-party contractors, such as plumbers, to do work that required a licence.
  1. [12]
    The Contract obliged Ingeteam to have work requiring a licence to be undertaken by licensed contractors. Such an arrangement permitted it to engage what has been described as the “head contractor exemption” in s 8 of Schedule 1A to the QBCC Act. In simple terms, the “head contractor exemption” allows a person to enter into a contract to provide commercial building work, even if they do not hold a building licence, provided that person only uses licensed subcontractors to carry out building work of the relevant class for which a licence is required.
  1. [13]
    If Ingeteam received an Additional Service order from Susan River, or Ingeteam proposed an Additional Service by giving Susan River a proposal in that regard, then clause 30 of the Contract governed the provision of the Additional Service with the valuation of the Additional Service to be determined by agreement between the parties (acting reasonably). The Annual Fee under clause 10 (calculated as an annual lump sum and paid in equal, monthly instalments) would be adjusted for the value of Additional Services and was payable in accordance with clause 11.
  1. [14]
    On 16 June 2023, Ingeteam sent to Susan River an email attaching a request for payment in the sum of $2,385,867 plus GST. It was said to be a “payment claim” for the purpose of s 68 of the BIF Act.
  1. [15]
    The sum of $2,385,867 primarily concerned unpaid monthly instalments of the Fee, together with some unpaid fees for Additional Services that had been provided under clause 30 of the Contract.
  1. [16]
    On 29 June 2023, Susan River provided to Ingeteam a payment schedule disputing the payment claim. Susan River contended that it was entitled to offset against any amounts payable to Ingeteam allowances for alleged defects and liquidated damages (referred to as “Availability Liquidated Damages”). Susan River did not raise the issue of licensing at that stage.
  1. [17]
    On 10 August 2023, Ingeteam lodged an application for adjudication of the payment claim with the third respondent. It referred the application to the second respondent and, on 18 August 2023, he accepted that referral.
  1. [18]
    On 26 September 2023, Susan River lodged its submissions in relation to the adjudication. Those submissions raised several jurisdictional points that had not been raised in Susan River’s payment schedule, including an issue about licensing.
  1. [19]
    In summary, Susan River submitted that by the Contract Ingeteam carried out, or undertook to carry out, “building work” as defined in the QBCC Act. Susan River did not identify any specific instances where Ingeteam performed building work in its written submissions. Instead, it referred to the fact that “building work” includes the “repair” of a building, and that under the Contract Ingeteam undertook to perform all scheduled and unscheduled maintenance of the Solar Farm. This maintenance was said to constitute the “repair” of a building for the purpose of the QBCC Act.
  1. [20]
    A contract entered into in breach of s 42 of the QBCC Act is unenforceable.[2] In order to submit a valid payment claim under the BIF Act, there must be an enforceable “construction contract”.[3] As a result, the existence of a construction contract is a precondition to an adjudicator having jurisdiction to determine a payment claim dispute.[4] Therefore, unlicensed building work is potentially a matter that goes to the adjudicator’s jurisdiction.
  1. [21]
    On 13 October 2023, the parties received an email from the adjudicator requesting that:
  1. Ingeteam provide written submissions in response to Susan River’s jurisdictional submissions on 17 October 2023; and
  2. Susan River provide its written submissions “in reply” on 19 October 2023.
  1. [22]
    The parties provided the further submissions requested by the adjudicator.
  1. [23]
    In those submissions, Ingeteam acknowledged that it did not hold any form of licence under the QBCC Act, and accepted the premise that the performance of its obligations under the Contract would have potentially required the carrying out of “building work” (namely, any building repairs that may have been required at the solar farm), but maintained that it had not contravened s 42 of the QBCC Act because of the “head contractor exemption” which is contained in s 8 of Schedule 1A to the QBCC Act.
  1. [24]
    As noted, the “head contractor exemption” ceases to apply if the head contractor causes or allows any of the building work to be carried out by a person who is not licensed to carry out building work of the relevant class.
  1. [25]
    For reasons more fully developed in the authorities, such as Sutton v Zullo Enterprises Pty Ltd,[5] Cant Contracting Pty Ltd v Casella,[6] and Panel Concepts Pty Ltd v Tomkins Commercial & Industrial Builders Pty Ltd,[7] there are two separate and distinct prohibitions imposed by s 42 of the QBCC Act. One is that a person must not “undertake” to carry out building work unless appropriately licensed. The other is that such a person must not “carry out” building work for which a licence is required. The first is directed at the point of contract formation and relates to questions of intent. I respectfully agree with Judge Porter KC’s analysis in Panel.[8] Simply put, an unlicensed person does not contravene the Act merely because they enter into a contract intending that work be carried out by a person who is licensed. The inquiry is about the party’s intention at the time the contract was formed.
  1. [26]
    The provisions of the QBCC Act governing work by licensed persons are reflected in provisions of the Contract, which provide that Ingeteam may subcontract work under the Contract but, in doing so, it must only use appropriately licensed contractors. In this regard, an employee of Ingeteam responsible for the negotiation of the Contract, Mr Munoz, gave unchallenged evidence to the second respondent that, when entering into the Contract, Ingeteam was aware of the requirement that a person must be licensed in order to perform building work and always intended that any “building work” would be performed by appropriately licensed subcontractors.
  1. [27]
    Importantly, in its original submissions on jurisdictional issues, Susan River did not identify or allege any occasions on which it contended that Ingeteam had performed works at the Solar Farm that were outside the scope of its electrical contractors’ licence. Only in submissions that were supposed to be submissions in reply did it allege four occasions on which it contended Ingeteam had performed work at the Solar Farm that required a licence, without using an appropriately licensed subcontractor. Incidentally, it made, but later withdrew, a submission in reply that a certain contractor was unlicensed.
  1. [28]
    As for the four allegations of unlicensed work, the adjudicator found that three of the four matters concerned the installation of electrical equipment that was not “building work that would require a person with a QBCC licence to install”. The fourth matter was the floor repair in the Delivery Station, for which Ingeteam charged and was paid $294.24.
  1. [29]
    Susan River alleged that Ingeteam procured materials from Bunnings and then used those materials to repair the floor. That was the only evidence it gave about the matter.

A denial of natural justice

  1. [30]
    The adjudicator’s reasons state that:

“… the Claimant has not had the opportunity to refute what the Respondent has evidenced and submitted in this regard, due to the last Party being able to make any further submissions about this jurisdictional matter being the Respondent in its Further Submissions in Reply. Nevertheless, I consider that procedural fairness has been extended to both Parties in respect of providing further submissions about the said 3 jurisdictional matters and the provision of further submissions has to stop at some point, to avoid prolixity.” (emphasis added)

  1. [31]
    This, with respect, was a failure to accord Ingeteam procedural fairness in circumstances in which the adjudicator acknowledged Ingeteam had not had an opportunity to respond to new factual allegations that Susan River first raised in further submissions in reply. Simply put, if the adjudicator, in the interests of expedition or for some other reason, did not wish to give Ingeteam an opportunity to give evidence and make submissions about a new matter upon which the adjudicator intended to base his conclusion about jurisdiction, the adjudicator should not have relied upon the parts of Susan River’s reply submissions that made new allegations of fact about unlicensed building work.
  1. [32]
    At the hearing before me, senior counsel for Susan River fairly acknowledged that there was a prima facie breach of procedural fairness in this regard. He submitted, however, that the breach was not material. I return to that issue.

The licensing findings about performing the floor repair

  1. [33]
    Having not had the benefit of any submissions from Ingeteam about the floor repair or why exemptions from licensing applied to it, the adjudicator found that it amounted to “building work” for the purpose of the QBCC Act.  He found:

“Whilst the charge rendered by the Claimant for performing those floor repairs was only a small amount, I find that any floor repairs performed by a contractor would constitute ‘building work’ under the QBCC Act, which should be performed by a licensed carpenter or other tradesperson holding another QBCC licence covering that kind of building works. There is, obviously, a good reason for that being the case, because, if a floor is repaired by an unlicensed person, there is a significant risk that the repair may fail and property damage and/or injury to persons may result. I consider that that concern and licencing requirement (sic) applies to any form of floor repair.” (emphasis added)

The finding that Ingeteam intended when entering into the Contract to not adhere to the requirements of s 42

  1. [34]
    Having found that Ingeteam performed unlicensed building work to a value of $294.42 on one occasion in March 2023, the adjudicator then proceeded to make a remarkable finding. He found that s 42 was contravened at the time of contract formation. The adjudicator purported to apply the principles discussed in Panel about proof of a party’s intention, and the uncontroversial proposition that a party’s intention may be determined from statements made by the person and from events that have happened before, at the time of, or after an act. This is the conventional process of drawing inferences about a party’s intention. The adjudicator made the following finding:

“Although, there is only one instance of a breach by the Claimant of the second performance limb s. 42, I find that that indicates, as a subsequent event to the formation of the O&M Contract, an intention by the Claimant when entering into the O&M Contract, not to adhere to the requirements of s. 42.

I therefore find that:

  1. a.
    the Claimant also breached the formation limb of s. 42; and
  2. b.
    as a result, I do not have jurisdiction to decide this payment claim dispute on its merits.”

The adjudicator’s conclusion on licensing and jurisdictional fact

  1. [35]
    Having reached the conclusion that Ingeteam, in repairing the floor with the plywood, performed building work without holding an appropriate QBCC licence, and also breached the “formation limb of s 42”, the adjudicator decided that he did not have jurisdiction to decide the payment claim dispute on its merits. As he wrote, “I do not have jurisdiction to decide this payment claim dispute on the merits, due to the Claimant’s breaches of both limbs of section 42”.
  1. [36]
    In short, because of his licensing findings, Ingeteam was not entitled to enforce the Contract, it therefore was not a contract to which the BIF Act applied, and the adjudicator had no jurisdiction. Expressed differently, Ingeteam was disentitled from making a payment claim under the BIF Act.

Alleged jurisdictional errors

  1. [37]
    Ingeteam submits that the adjudicator’s conclusion was affected by three jurisdictional errors. The first concerns the conclusion that it performed “building work” without an appropriate licence, in circumstances in which either the “floating floor” exemption or the exemption for work valued at less than $3,300 applied. The second error is the finding that Ingeteam “undertook” to perform unlicensed work when it entered into the Contract. The third is the denial of procedural fairness in respect of the licensing findings.

Susan River’s response

  1. [38]
    Susan River’s response to Ingeteam’s case that these three jurisdictional errors warrant the licensing findings being set aside may be summarised as follows.
  1. [39]
    First, it defends the correctness of the adjudicator’s decision by alleging that the “floating floor” exclusion did not apply.
  1. [40]
    Second, it contends that the errors were not “jurisdictional errors” or were not material. One aspect of its argument on materiality is that, having found that he did not have jurisdiction to decide the matter due to his licensing findings, the adjudicator went on to consider a jurisdictional point in relation to an available reference date and found that a 13 May 2023 reference date had already been used by Ingeteam.
  1. [41]
    Third, Susan River submits that what is referred to as Dualcorp issue estoppel” does not apply because the jurisdictional issue about licensing determined by the adjudicator was not “fundamental”.
  1. [42]
    Fourth, it contends that the Court does not have jurisdiction to grant the kind of relief sought by Ingeteam.
  1. [43]
    The written submissions of Susan River dated 21 February 2024 also submitted that the application was premature and hypothetical because no adjudicator had been appointed. However, that submission has been overtaken by events. Unless restrained, the new adjudicator might readily apply Dualcorp and the authorities that have discussed it, and conclude that the previous determination of jurisdiction based on the licensing findings cannot be reagitated and, therefore, he lacks jurisdiction. The issue that arises for determination by me is neither premature nor hypothetical.

Ingeteam’s reply

  1. [44]
    Ingeteam responds to the points raised by Susan River by contending that:
  1. the licensing decision was clearly jurisdictional, since it was expressly relied upon by the adjudicator to conclude that he did not have jurisdiction;
  2. the licensing decision affects not only the decision that was made by the second respondent, it binds (in the sense discussed in the “Dualcorp issue estoppel” cases) other adjudicators, and the new adjudicator in particular, who has been temporarily restrained from making the same decision on jurisdiction;
  3. the denial of procedural fairness and the other jurisdictional errors were clearly material;
  4. the licensing decision is the kind of material decision attended by jurisdictional error that s 101(4) of the BIF Act permits the Court to declare void, leaving other parts of the adjudication to stand.

Was the licensing decision wrong?

  1. [45]
    As noted, Ingeteam submits that the adjudicator erred in making the licensing findings. One reason is the “floating floor” exemption. Another is the availability of an exemption concerning work valued at less than $3,300. The second matter is associated with the fact that the floor repair was provided as an “Additional Service”. Ingeteam submits that the repair was not undertaken pursuant to the Contract, but pursuant to a separate agreement struck in accordance with clause 30 of the Contract.
  1. [46]
    The next licensing issue concerns the finding that Ingeteam “undertook” to perform unlicensed work at the time of contract formation.
  1. [47]
    An overarching submission is that in making the licensing findings the adjudicator did not accord procedural fairness.

Was the plywood a “floating floor”?

  1. [48]
    In its further submissions in reply sent to the adjudicator on the evening of 19 October 2023, Susan River said little about the floor repair in the Delivery Station, save that it was either “building work” or “building work services”. It relied on a declaration by Mr Richard Armstrong that Ingeteam sought payment on 29 March 2023 for Additional Services under the Contract. The exhibited claim simply stated “Floor repair & materials from Bunnings” and claimed an amount of $294.24.
  1. [49]
    Because Ingeteam was not given an opportunity by the adjudicator to respond to this matter, it did not place evidence before him about the floor repair. The evidence about the floor repair that it has placed before this Court is slender. The fact that it no longer has access to the site may be one reason for this. However, its affidavit material says little about the floor repair. That said, Susan River placed no evidence before me about the nature of the floor repair and the plywood cover that was taped to the floor of its building.
  1. [50]
    The evidence exhibited to Mr Lancashire’s affidavit includes a photograph that Mr Carlin Whittle, a licensed electrician, took at the time of the work and included with the relevant invoice. The relevant documents show that Ingeteam purchased from Bunnings at Hervey Bay a handsaw for about $10, some “Tough & Wide Gorilla Tape”, and some plywood. The square piece of plywood was about 1.4 square metres in size and 12 millimetres thick. The total cost of these items was approximately $125. The Bunnings’ invoice was split between two different sites and one hour of Mr Whittle’s time was charged to each. The other site was the Childers Solar Farm. In the result, Ingeteam charged $294.24 for the floor repair and materials at the Susan River Solar Farm.
  1. [51]
    The photo depicts the inside of what is described as the Delivery Station. It shows the floor of that building that is reached by climbing a few stairs from the ground. The small area of floor to the top of the photograph appears to be uncovered concrete. The larger area to the bottom of the photograph has a different colour and, doing the best I can, appears to have been covered in vinyl. The plywood sits on the floor immediately inside the doorway. On each of its sides is an adhesive tape touching a centimetre or two of the edge of the board, and a centimetre or two of the floor. Obviously, the tape is supposed to keep the plywood in place.
  1. [52]
    There is no evidence that the plywood was nailed, drilled or glued to the existing floor. For instance, there was no claim for glue. Susan River does not suggest, let alone call evidence, that the plywood cannot be simply removed by removing the adhesive tape around its edges.
  1. [53]
    The reason for the repair is not stated in evidence by either party. However, given the state of the evidence, a reasonable inference is that a vinyl or similar surface just inside the door became worn. Rather than repair it with entirely new vinyl, this quick, simple and inexpensive form of repair was undertaken.
  1. [54]
    During oral submissions, I suggested that covering part of the existing floor with a piece of plywood in a worn area was the functional equivalent of wooden floorboards that have become worn being covered by a rug or carpet. That may be a cheap alternative to having the floor polished and restored. Plywood may be a less aesthetically pleasing solution to a rug, but it performs in a shed the same function of covering a floor surface that requires repair.

The meaning of “floating floor”

  1. [55]
    Section 30 of the Queensland Building and Construction Commission Regulation 2018 (Qld) (the “Regulation”) contains numerous matters that, for the purpose of Schedule 2 of the QBCC Act, are not building work. Item 30 of Schedule 1 to the Regulation reads:

30 Laying carpets, floating floors or vinyl

  1. Laying of carpets, floating floors or vinyl.
  2. In this section –

floating floor means a floor that covers a subfloor but is not fixed to the subfloor.”

  1. [56]
    The term “floating floor” is not said to be a technical term. Section 30(2) defines it and permits s 30(1) to be concise. The term also derives its meaning from its context in relation to other floor coverings. It is apt to include a wooden floor or a piece of wood that partly covers a subfloor, but is not fixed to the subfloor. Therefore, it would not include wood or other material that is nailed, screwed or glued to the subfloor. It would include, however, material that can be installed and removed easily without affecting the subfloor.
  1. [57]
    Just as carpet layers and installers of vinyl do not undertake “building work”, someone who lays a floating floor does not undertake “building work”. Having regard to the statutory context, the laying or removal of a floor that is not fixed to the subfloor is unlikely to require carpentry or other trade skills.
  1. [58]
    In this matter, the plywood was simply laid on the existing floor. It did not replace the existing floor. It was not like a new piece of wood that replaced rotting wood that was removed and then became the floor. The plywood in this case sat on the existing floor and covered it. The under-surface of the plywood was not glued or otherwise fixed to the subfloor. The plastic tape held the plywood in position and could be removed by someone having no trade skills. In the context of Item 30, it was not “fixed” to the subfloor. It would be no more fixed to the subfloor than a rug in a home that is kept in position by a piano, chair or table.
  1. [59]
    If anything that kept a floor covering in place so as to avoid a trip hazard or some other unwanted outcome meant that the floor was “fixed” then the “floating floor” exception would have a very limited and apparently unintended operation.
  1. [60]
    Incidentally, carpet may be laid and held in place by Velcro, other adhesives or staples. It is difficult in the circumstances to see why the presence of the tape in this case should lead to the conclusion that the plywood was “fixed” to the existing floor, for the purpose of Item 30.
  1. [61]
    The word “fixed” in Item 30 should be given a meaning that fits its context and the apparent purpose of the exemptions. A tradesperson’s skill might be required to “fix” a floor to a subfloor with nails, screws or glue. The skills of a licensed tradesperson are not required to tape the edges of a piece of plywood to a floor. The legislation should not be assumed to have used “fixed” to include a case like this.
  1. [62]
    It would be an odd outcome if the exemption applied to taping a carpet square or piece of vinyl of the same size as the plywood with the same tape, but did apply to taping a piece of plywood in place. What purpose of the QBCC Act and the Regulation could be advanced by such a distinction? Can the legislature be supposed to have intended that one needed a licensed tradesperson to tape a piece of plywood or cardboard to a floor, but not to tape a piece of linoleum of the same size and for the same purpose?
  1. [63]
    I conclude that laying the plywood on top of the existing floor was laying a floating floor within the meaning of Item 30. Because Item 30 of the Regulation applied, it exempted the work from the definition of “building work”.
  1. [64]
    The adjudicator therefore erred in concluding that Ingeteam was carrying out “building work” and needed a licence to do so. He erred in concluding that the carrying out of unlicensed building work meant that he did not have jurisdiction to decide the payment claim.
  1. [65]
    This makes it unnecessary to reach a conclusion about whether the exemption in Item 2 of the Regulation for work of a value of $3,300 or less applies.
  1. [66]
    Also, I should not delay to discuss the so-called “handyman exception” and the arguments advanced as to whether the claim for the sum of $294.24 was pursuant to the Contract or pursuant to a separate contract that was formed in accordance with clause 30. My provisional view is that it was an Additional Service under the Contract and was payable under that contract once the value was agreed. However, it is unnecessary to reach a conclusion on that point in circumstances in which the parties have requested an expedited decision and the clock is ticking in the adjudication application process that the new adjudicator has been appointed to determine.

Did the adjudicator err in concluding that Ingeteam intended to perform unlicensed building work, and was this a jurisdictional error?

  1. [67]
    The finding that Ingeteam did not carry out building work for which it required a licence in undertaking the repair to the floor in the Delivery Station removes the solitary basis upon which the adjudicator concluded that Ingeteam intended, when entering into the Contract, to not adhere to the requirements of s 42. I should add that, even if the adjudicator had been right in concluding a breach of the performance limb of s 42 in relation to the floor repair, this provided no proper basis to reach the conclusion that he did about Ingeteam’s intention at the time of contract formation.
  1. [68]
    This contention was not advanced by Susan River in submissions to the adjudicator. Instead, Susan River submitted that the decision in Panel was inconsistent with other authority and that s 42 was breached regardless of Ingeteam’s intention. Susan River did not submit that the floor repair evidenced a breach of the formation limb of s 42. Despite this, the adjudicator reached this conclusion and therefore determined the matter on a basis that it was not contended for. This was a denial of procedural fairness in relation to a finding that entailed a contravention by Ingeteam of the QBCC Act, which exposed it to enforcement action by the authorities.
  1. [69]
    In addition to the absence of procedural fairness in reaching an important finding that Ingeteam breached “the formation limb of s 42”, this finding was completely unreasonable, illogical and unexplained. While as a matter of principle subsequent acts may, along with other circumstantial evidence, support a finding as to a party’s intention some years earlier, that principle had no practical application to this issue. The finding was supposition or conjecture, not a rational inference, about the intention of Ingeteam at the time of contractual formation, based upon the installation of a piece of plywood by an electrician some years later.
  1. [70]
    There is no suggestion that Mr Whittle, who installed the plywood, thought he was undertaking unlicensed building work and intended to do so. Even if, in the absence of any evidence or argument to support that proposition, one were to assume that he intended to undertake unlicensed building work in March 2023, that assumption was a completely inadequate foundation to infer anything about the company’s intention in September 2020, when it entered into the Contract. Moreover, the unchallenged evidence from Mr Munoz’s declaration was that Ingeteam never intended to use unlicensed persons to perform building work at the Solar Farm. This evidence was not mentioned by the adjudicator in reaching the serious finding that he did about Ingeteam’s intention.
  1. [71]
    Such a serious finding which had the effect of rendering the Contract unenforceable, and to deprive Ingeteam of any right to payment under the BIF Act, should not have been made. It should not have been made because it was not contended for by Susan River. It should not have been made because no evidence supported the finding. The finding that Ingeteam breached the “formation limb of s 42” was unreasonable in the legal sense. It was irrational in the sense that it was not supported by any reasoning. It lacked logic. It was not based on findings of fact or inferences from facts supported by logical grounds.[9]
  2. [72]
    The BIF Act did not authorise the adjudicator to make a legally unreasonable decision. The decision related to the enforceability of the Contract and jurisdiction. Finding that Ingeteam breached the formation limb of s 42 led the adjudicator to conclude, “[a]s a result, I do not have jurisdiction to decide this payment claim dispute on its merits”. The error qualifies as a jurisdictional error. It provides an additional ground as to why the findings based on s 42 and the consequent conclusion that the adjudicator did not have jurisdiction, should be set aside.

Three errors

  1. [73]
    In summary, the decision about jurisdiction was affected by a denial of procedural fairness, an error that unlicensed building work had been performed, and a finding of a breach of the formation limb of s 42 that no reasonable decision-maker could have arrived at on the basis of the evidence and submissions made to him or her.

Denial of procedural fairness

  1. [74]
    As indicated, there was a denial of procedural fairness in at least two respects. The first is the adjudicator’s acknowledged failure to provide Ingeteam with the opportunity to refute what Susan River had placed before him as evidence and had submitted in relation to the purported unlicensed building work on the floor repair in the Delivery Station. Senior counsel for Susan River acknowledged that there was a prima facie breach of procedural fairness in this regard. The second is the matter which I have just discussed, namely reaching the conclusion that Ingeteam did not intend, when entering into the Contract, to adhere the requirements of s 42. This finding was made without providing Ingeteam the opportunity to make submissions on a point which was not argued by Susan River but was relied upon by the adjudicator in concluding that he did not have jurisdiction to decide the payment claim.
  1. [75]
    As to the denial of natural justice in relation to the finding of a breach of s 42 in performing the floor repair, the adjudicator should have given Ingeteam an opportunity to respond. A short delay in the completion of his reasons was not a proper basis to deny Ingeteam that opportunity in relation to a matter that the adjudicator relied upon to find that he did not have jurisdiction. Alternatively, if the adjudicator was not to provide such an opportunity, he should have disregarded the parts of Susan River’s further submissions in reply that were not truly “in reply”.[10] If Susan River wished to rely upon allegations of unlicensed building work in the four respects contended for in the submissions in reply, it should have raised the matter in earlier submissions or sought approval to include new factual matters in “reply” submissions.

Were the licensing findings affected by a material jurisdictional error?

Procedural fairness

  1. [76]
    A denial of procedural fairness of the kind that I have found is a jurisdictional error, subject to the qualification that, depending upon the statutory context and the facts, an administrative decision will not be rendered invalid by an immaterial error.[11]
  2. [77]
    The parties referred to Hossain v Minister for Immigration and Border Protection[12] on the issue of materiality. Kiefel CJ, Gageler and Keane JJ observed that a statute which impliedly requires a condition to be observed in the course of a decision-making process is not to be interpreted as denying legal force and effect to every decision that might be made in breach of the conditions. The statute “is ordinarily to be interpreted as incorporating a threshold of materiality in the event of non-compliance”.[13] Their Honours continued:[14]

“Whilst a statute on its proper construction might set a higher or lower threshold of materiality, the threshold of materiality would not ordinarily be met in the event of a failure to comply with a condition if complying with the condition could have made no difference to the decision that was made in the circumstances in which that decision was made. The threshold would not ordinarily be met, for example, where a failure to afford procedural fairness did not deprive the person who was denied an opportunity to be heard of “the possibility of a successful outcome”, or where a decision-maker failed to take into account a mandatory consideration which in all the circumstances was “so insignificant that the failure to take it into account could not have materially affected” the decision that was made.”

  1. [78]
    In MZAPC v Minister for Immigration and Border Protection,[15] the Court clarified that the “materiality” of a breach requires determination of “the basal factual question of how the decision that was in fact made was in fact made”.[16] Then, it is necessary to consider whether the decision in fact made could have been different had the relevant condition been complied with. This is determined “as a matter of reasonable conjecture within the parameters set by the historical facts that have been determined”.[17] The burden falls on the applicant to prove “on the balance of probabilities the historical facts necessary to enable the court to be satisfied of the realistic possibility that a different decision could have been made had there been compliance with that condition”.[18]
  2. [79]
    In Nathan v Minister for Home Affairs and Another,[19] Kiefel CJ, Keane and Gleeson JJ again referred to “a realistic possibility” that a different decision could have been made. Their Honours stated:[20]

“There will generally be a realistic possibility that a decision-making process could have resulted in a different outcome if a party was denied an opportunity to present evidence or make submissions on an issue that required consideration. The standard of “reasonable conjecture” is undemanding. It recognises that a fundamental purpose of affording procedural fairness is to afford an opportunity to raise relevant matters which are not already obvious, or not liable to be advanced by the apparently persuasive “story” of the opposing party. Where a Tribunal errs by denying a party a reasonable opportunity to present their case, “reasonable conjecture” does not require demonstration of how that party might have taken advantage of that lost opportunity. Nothing said in MZAPC denies this. To the contrary, the standard of “reasonable conjecture”, correctly applied, proceeds on assumptions that are derived from the rationale for procedural fairness, namely that, if given a fair opportunity to present their case, a party will take advantage of that opportunity and that, by doing so, the party could achieve a favourable outcome.” (citations omitted)

  1. [80]
    Gageler J (as the Chief Justice then was) reached a similar conclusion in stating:[21]

SZMTA and MZAPC are together authority for two cumulative propositions. The first is that a denial of procedural fairness results in a decision being affected by jurisdictional error, so as to be capable of justifying the grant of curial relief, only if that denial is shown by the applicant to have been material to the decision. The second is that the materiality of a denial of procedural fairness is shown by the existence of a realistic possibility that the decision could have been different had procedural fairness been observed.

SZMTA and MZAPC do not hold that, in order to meet the threshold of materiality, an applicant for relief must establish any part of what would have occurred on the balance of probabilities had a fair opportunity to be heard been afforded. The onus which the applicant bears to establish materiality is no greater than to show that, as a matter of reasonable conjecture within the parameters set by the historical facts established on the balance of probabilities, the decision could have been different had a fair opportunity to be heard been afforded.” (citations omitted)

  1. [81]
    Gordon J[22] and Edelman J[23] each adopted a different approach to the implication concerning materiality.
  1. [82]
    These general principles about materiality fall to be applied in the light of the facts of this case and the particular statutory context. For the reasons that I have given, the adjudicator’s denial of procedural fairness satisfied at least the “reasonable conjecture” test. Had procedural fairness been accorded, there is at least a realistic possibility that the adjudicator would have made a different decision on the licensing issues and the existence of a “construction contract” for the purpose of the BIF Act, and not concluded that he lacked jurisdiction because of Ingeteam’s alleged breach of the licensing requirements.
  1. [83]
    At the very least, if Ingeteam has been given the opportunity to make submissions about the floor repairs and also what might be inferred, if anything, about its intention at the time of contract formation, it is distinctly possible that the adjudicator would not have led himself into error on both points. There is a real possibility that according procedural fairness would not have resulted in the conclusion that was reached, namely that the adjudicator did not have jurisdiction to decide the payment claim due to Ingeteam’s alleged breaches of both limbs of s 42. The breaches of procedural fairness were material.

Findings on jurisdiction

  1. [84]
    The licensing findings were affected by jurisdictional error in the form of a denial of procedural fairness. I have also found that the adjudicator erred in finding that he had no jurisdiction because Ingeteam did not have a licence to undertake work on the floor that required a licence, and because it had breached s 42 at the time of the contract’s formation. It did not need a licence and the finding that it breached s 42 at the time of formation was a conclusion that was not authorised by law.
  1. [85]
    The present issue is whether these errors amount to jurisdictional errors. In my view, they do. Each erroneous finding related to a matter that was essential to the adjudicator having jurisdiction. Under s 84(2)(a)(i) an adjudicator must decide whether he or she has jurisdiction to adjudicate the application. The valid exercise on an adjudicator’s jurisdiction is conditioned on the existence of a “construction contract” between the claimant and the  first  respondent, to which the BIF Act applies.[24]
  1. [86]
    A jurisdictional error will occur where a decision-maker finds a fact that is a precondition to the conferral of jurisdiction exists when it does not exist, or finds that such a fact does not exist when it does.
  1. [87]
    The High Court in Kirk v Industrial Court of New South Wales[25] summarised what had earlier been stated in Craig v South Australia[26] in connection with the jurisdiction of an inferior court. It stated that:[27]

“An inferior court falls into a jurisdictional error ‘if it mistakenly asserts or denies the existence of jurisdiction.”

The same principle applies to tribunals and other decision-makers.

  1. [88]
    In this matter, the adjudicator mistakenly denied the existence of jurisdiction on the basis that there was no enforceable construction contract that authorised the making of the payment claim. He found that he did not have jurisdiction because the contract was not enforceable due to a breach of licensing requirements. His erroneous licensing findings led directly to and founded the conclusion that he did not have jurisdiction. This amounted to a jurisdictional error.
  1. [89]
    It is unnecessary to explore the meaning of “jurisdictional error” in the context of the exercise of jurisdiction under the BIF Act. A number of propositions in that regard were advanced by Bond J (as his Honour then was) in Acciona Agua Australia Pty Ltd v Monadelphous Engineering Pty Ltd.[28]
  2. [90]
    Kiefel CJ, Gageler and Keane JJ in Hossain[29] remarked that jurisdictional error is an expression not simply of the existence of an error but of the gravity of that error. Their Honours observed that the distinction between jurisdictional errors and non-jurisdictional errors is ultimately “a distinction between errors that are authorised and errors that are not; between acts that are unauthorised by law and acts that are authorised”.[30]
  3. [91]
    I turn to consider the issue of materiality in connection with the adjudicator’s determination that because of non-compliance with licensing requirements, he lacked jurisdiction. If the requirement of “materiality” is embedded in the concept of “jurisdictional error”, an error going to jurisdiction that is a jurisdictional error will be material. If, however, the requirement for materiality relates to whether a jurisdictional error will render a decision invalid, then the issue of materiality is a separate inquiry.
  1. [92]
    The adjudicator determined that, because of licensing breaches, he did not have jurisdiction. This determination was not a finding about some inconsequential matter. It was not simply an error on the face of the record about a matter that he was required to decide, having first determined that he had jurisdiction.[31] Unlike an erroneous finding of fact in the exercise of jurisdiction, the adjudicator’s determination that he did not have jurisdiction because of the licensing breaches was not a matter that he has authority to get wrong. It was a determination about the existence of jurisdiction.
  1. [93]
    Susan River argues that the alleged jurisdictional error was not material, or not a jurisdictional error at all, because the adjudicator went on to decide that he did not have jurisdiction for an additional reason. According to Susan River, in circumstances in which the adjudicator also decided that he did not have jurisdiction because of the absence of a reference date, there was no “jurisdictional error” in relation to the licensing findings.
  1. [94]
    Ingeteam responds that the erroneous denial of jurisdiction that resulted from the licensing findings is jurisdictional and material. The finding of a lack of jurisdiction because the Contract was unenforceable by it and not a “construction contract” to which the BIF Act applied continues to have force and validity. Importantly, it operates by virtue of Dualcorp issue estoppel authorities to affect the current adjudication proceeding being heard by the new adjudicator. This adjudication process relies on a different reference date to the one relied upon before the second respondent. It is said to be the last available reference date under the Contract.
  1. [95]
    According to Ingeteam, the determination of the second respondent on jurisdiction that it seeks to invalidate has material, indeed “diabolical”, consequences. Unless set aside, Ingeteam cannot submit another payment claim. The determination is binding in any subsequent adjudication and the new adjudicator will be bound to apply the second respondent’s findings about unlicensed building work and dismiss the claim for $2.6 million.
  1. [96]
    Mr LeMass of counsel argued that the impugned determination “sterilises” Ingeteam’s ability to recover moneys to which it is entitled under the BIF Act.

Dualcorp issue estoppel

  1. [97]
    A form of issue estoppel arises from certain findings made by an adjudicator under the BIF Act. The authorities often refer to it as “Dualcorp issue estoppel” because it is based on New South Wales Court of Appeal decision in Dualcorp Pty Ltd v Remo Constructions Pty Ltd.[32]
  2. [98]
    The determination of jurisdiction that resulted from the licensing findings differs in terms of gravity and consequence from the alternative ground in relation to an available reference date. Dualcorp issue estoppel doctrine does not preclude a claimant like Ingeteam relying upon a new reference date. It does, however, preclude it from contesting the determination that there is no “construction contract” because of a breach of licensing requirements.
  1. [99]
    In Caltex Refineries (Qld) Pty Ltd v Allstate Access (Australia) Pty Ltd,[33] Philip McMurdo J stated:

“[Dualcorp] identifies a finality of an adjudicator's decision in the sense of precluding a claimant from pursuing a progress payment inconsistently with determination of an issue by an adjudicator which was fundamental to that decision.”

  1. [100]
    In John Holland Pty Ltd v Schneider Electric Buildings Australia Pty Ltd,[34] I stated:

“The provisions of the Act indicate an intent that it provide ‘a simple and quick means of contractors obtaining progress payments, with a mechanism being provided for the speedy resolution of disputes.’ It would be inconsistent with this objective to allow a claimant who was dissatisfied with an adjudication of its claim to obtain a reconsideration of issues that had been determined at an earlier adjudication, especially if there was no limit to the number of times that a claimant could seek to have this reconsideration occur. … an adjudication determination that resolves a dispute is binding between the parties for the purposes of the Act. Such a determination does not affect any right that a party to a construction contract may have under the contract or under the general law.” (emphasis added)

  1. [101]
    More recently, Martin SJA in Karam Group Pty Ltd v HCA Queensland Pty Ltd[35] reviewed the authorities in Queensland and other states. His Honour concluded that there is agreement that “a party may be prevented from arguing for a particular conclusion on an issue where that issue has been raised and decided in an earlier arbitration decision”.[36] Martin SJA followed authorities to the effect that a form of issue estoppel may arise from findings made by an adjudicator under the BIF Act.
  1. [102]
    Whether the prohibition on the re-agitation of certain issues is treated as a form of issue estoppel or a control against abuse of process,[37] the determination of the existence or non-existence of a “construction contract” to which the claimant is a party is the kind of issue to which the prohibition applies.
  1. [103]
    In its submissions, Susan River places emphasis on the observation made by Philip McMurdo J in Caltex Refineries that Dualcorp issue estoppel precludes pursuit of a progress payment inconsistently with the determination of an issue by an adjudicator that was “fundamental” to that decision.[38] It contends, in effect, that the adjudicator’s determination that he lacked jurisdiction because of the breach of licensing requirements was not fundamental because there was an alternative basis upon which he decided that he did not have jurisdiction.
  1. [104]
    I am not persuaded by this submission. The issue of whether a “construction contract” under the BIF Act exists is a “fundamental” issue in the sense that McMurdo J used that word. An issue that has been determined and to which Dualcorp issue estoppel applies and, in particular, a finding on the existence or absence of a critical jurisdictional fact, does not cease to be the subject of a Dualcorp issue estoppel because an alternative basis exists to find a lack of jurisdiction.
  1. [105]
    The issue of whether there was a “construction contract” so as to give the adjudicator jurisdiction is the kind of issue that engages a Dualcorp issue estoppel. This is so in the present case because:
  1. the determination of the licensing issue led the adjudicator to decline jurisdiction; and
  2. it affects Ingeteam’s statutory right to make a payment claim and to apply for an adjudication decision of the kind that is sought from the new adjudicator.
  1. [106]
    The new adjudicator, following the authorities which have confirmed the existence of Dualcorp issue estoppel, would be expected to not allow Ingeteam to reagitate the “construction contract”/licensing issue determined against it in an earlier adjudication, unless and until that determination is declared invalid by a court. This is so even if Susan River does not intend to rely upon Dualcorp, and will seek to reagitate certain issues that were decided against it by the second respondent.
  1. [107]
    Therefore, I accept Ingeteam’s submission that the decision about jurisdiction which it seeks to invalidate is material. At the very least, Ingeteam is at a substantial risk that the new adjudicator, in accordance with the Dualcorp authorities, will consider the decision made by the second respondent about jurisdiction to be binding on him, and to find that Ingeteam should not be permitted to reagitate the jurisdictional issue that was found against it that there was no “construction contract”.

Conclusion on materiality

  1. [108]
    In summary, the adjudicator’s errors in relation to licensing were on a jurisdictional issue. The errors made by the adjudicator related to the existence of a jurisdictional fact, a matter of inherent gravity. The errors led the adjudicator to conclude that he did not have jurisdiction. That determination also has implications for Ingeteam’s statutory rights arising out of the same construction contract. The determination has continuing effects because of Dualcorp issue estoppel. The determination about jurisdiction was sufficient to dispose of the earlier adjudication application and has legal consequences for the current adjudication.
  1. [109]
    A conclusion on materiality turns on the facts at hand and the statutory context. That statutory context includes s 101(4), to which I will turn. Simply stated, the section contemplates that one part of a decision may be invalidated on the grounds of jurisdictional error, while other parts stand. It does not support characterising a decision as a “singular determination” rather than a determination that may include more than one decision about jurisdiction. Section 101(4) contemplates a case in which an erroneous decision on jurisdiction is invalidated and another decision on jurisdiction remains binding.
  1. [110]
    I conclude that the determination of the “construction contract” issue was a fundamental, jurisdictional issue. It was expressly stated to be a finding that resulted in the adjudicator not having jurisdiction to determine the application. The determination about a jurisdictional fact, namely the existence or absence of a “construction contract” to which the BIF Act applies, has force and effect unless and until declared invalid. The determination that there was no “construction contract” in this case affected not only the outcome of the adjudication application that was before the second respondent. It affects the statutory rights of Ingeteam to seek an adjudication by the fourth respondent of its present claim for more than $2.6 million.
  1. [111]
    The determination that there was no “construction contract” and therefore no jurisdiction was material to the outcome of the last adjudication process and to the current one.

The statutory scheme

  1. [112]
    In determining whether an error is a jurisdictional error, or whether a jurisdictional error is material in the sense that it should lead to a decision or part of a decision being declared invalid, regard should be had to the statutory scheme that condition the existence of jurisdiction and that govern the exercise of that jurisdiction. In some statutory contexts, a minor error in compliance with a statutory condition that governs the decision-making process may not result in the decision that is arrived at being declared invalid.
  1. [113]
    The parties accept that a jurisdictional error may involve an erroneous assertion of jurisdiction, as well as an erroneous denial of jurisdiction.[39] The existence of a valid construction contract is a prerequisite to the exercise of the adjudicator’s jurisdiction and, therefore, whether or not there is such a contract is a jurisdictional fact.[40] In the context of the statutory scheme created by the BIF Act, an error by an adjudicator in finding that he or she has jurisdiction or lacks jurisdiction is, almost by definition, a jurisdictional error.
  1. [114]
    A determination that a jurisdictional fact exists or does not exist can hardly be regarded as a minor or immaterial matter. It certainly should not be treated as immaterial where an erroneous determination about jurisdiction was affected by a denial of procedural fairness that, if given, had a realistic possibility of resulting in a different decision: one that was not affected by jurisdictional error.
  1. [115]
    A decision-maker who falls into jurisdictional error in mistakenly asserting or denying the existence of jurisdiction ordinarily will be taken to have made a determination that should be invalidated because it cannot be treated as an immaterial error.
  1. [116]
    The statutory scheme created by the BIF Act includes Dualcorp issue estoppel. In that context, a mistaken assertion or denial of jurisdiction has consequences beyond the immediate adjudication decision. An erroneous finding on a jurisdictional fact, such as the existence or absence of a valid “construction contract”, governs the right of a party to make a further payment claim under the BIF Act and to invoke the Act’s adjudication process. By virtue of Dualcorp issue estoppel, a determination that there is no valid construction contract determines the issue of jurisdiction in one adjudication proceeding and also the issue of jurisdiction in a subsequent adjudication process.
  1. [117]
    In the context of the statutory scheme, a determination that there is no valid construction contract and therefore no jurisdiction has significant and enduring consequences for the claimant’s statutory rights and for any further adjudication process. In the circumstances, it is difficult to characterise an important and consequential, but erroneous, decision about a statutory precondition to making a valid payment claim as immaterial. Because such a decision is material, an erroneous determination on an issue of jurisdiction ordinarily should be invalidated.

Can the Court grant the remedy that is sought?

  1. [118]
    The Court has a supervisory jurisdiction to review for jurisdictional error. There seems no reason in principle as to why this jurisdiction may not be exercised in relation to a threshold determination about whether the adjudicator has jurisdiction to adjudicate an application,[41] and also, if having made a correct determination on that matter, a determination about the amount of the progress payment, if any, to be paid.[42]
  2. [119]
    In a case such as this, “where only part of an adjudicator’s decision under [chapter 3] is affected by jurisdictional error”, the terms of s 101(4) appear to permit this Court to:
  1. identify the part affected by the error; and
  2. allow the part of the decision not affected by the error to remain binding on the parties to the proceeding.

Therefore, in this case, s 101(4) allows the adjudicator’s decision about the absence of a reference date to stand, and for the part of the decision affected by jurisdictional error to be invalidated.

  1. [120]
    Susan River submits that, as a matter of construction, s 101(4) does not apply to decisions under s 84 and only applies to decisions under s 88 where the adjudicator has already found that there was jurisdiction and proceeded to make a decision about what, if anything, is to be paid to the claimant. That submission is not supported by the terms of s 101(4) and such an interpretation is not necessary in order to achieve the apparent purpose of the section. The purpose of the section is apparent from its terms. It permits the Court in the exercise of its supervisory jurisdiction to identify the part of an adjudicator’s decision that is affected by jurisdictional error, and to make orders that the part is invalid, while allowing the part of the decision that is not affected by jurisdictional error to remain binding on the parties.
  1. [121]
    Susan River cites the decision of Ball J in Olympia Group (NSW) Pty Ltd v Hansen Yuncken Pty Ltd.[43] It concerned the provisions of the then New South Wales Act in a case in which the adjudicator decided that because the construction site was located outside New South Wales, he did not have jurisdiction. Ball J, with respect, correctly concluded that the decision was not a determination under s 22 of the New South Wales Act about the amount that was payable. Instead, it was a question of whether the adjudicator could exercise jurisdiction, not a determination made in the exercise of that jurisdiction. That decision does not bear, however, upon the application of s 101(4) of the current Queensland Act to a threshold decision on jurisdiction.
  1. [122]
    The proper construction of s 101(4) is determined by having regard to its text and its statutory context. Importantly, s 101(4) refers to “an adjudicator’s decision under this chapter”. The provision is apt to refer to either a decision under s 84(2)(a)(i) or a decision under s 88(1). Had the legislature intended it to apply only to a decision under s 88(1), then s 101(4) would be worded differently.
  1. [123]
    I am unable to discern a good reason why s 101(4) should not be interpreted according to its terms or why it should be construed as applying to only one kind of decision made under Chapter 3 of the BIF Act. There seems no principle why a jurisdictional error made in respect of the existence or non-existence of a jurisdictional fact should not be subject to s 101(4). The section has a beneficial purpose and should be applied in a case like this to allow the part of a decision that is affected by jurisdictional error to be invalidated, and the part of the decision that is not affected by the error to remain binding on the parties to the proceeding.
  1. [124]
    In some cases, a decision that is affected by jurisdictional error should be invalidated in whole. In this case, however, it seems appropriate to apply s 101(4) so that the part of the decision relating to a reference date remains binding on the parties and the part that is affected by jurisdictional error and which affects the pending adjudication, unless invalidated, be declared void.
  1. [125]
    In the result, s 101(4) permits the Court to make an order of the kind sought. The practical effect of the order is that the part of the adjudicator’s decision that is affected by jurisdictional error, namely the licensing findings, is declared void for jurisdictional error. There should also be a declaration that the licensing findings (as defined in the originating application) do not bind the applicant and the first respondent. Declaring void that part of the decision means that the issue of jurisdiction that flowed from the licensing findings, namely that there was no valid construction contract, will not be the subject of a Dualcorp issue estoppel.

Overview of legal issues

  1. [126]
    Susan River’s carefully-developed submissions focus on the fact that there was a second and alternative decision on jurisdiction, being a reference date decision. According to Susan River, this means that the decision that the adjudicator lacked jurisdiction because of licensing requirements:
  1. is not a jurisdictional decision and therefore not attended by jurisdictional error;
  2. is a non-jurisdictional error that is not amenable to the Court’s supervisory jurisdiction; and
  3. is not a mistaken denial of jurisdiction that is material.

It argues that because the jurisdictional decision about licensing requirements, even if erroneous, is not a jurisdictional error, there is no jurisdiction in this Court to make the orders sought.

  1. [127]
    In my view, the adjudicator’s alternative basis to decline jurisdiction, while relevant, does not alter the fact that he decided that he did not have jurisdiction because of non-compliance with licensing requirements. That determination was about the existence of an essential jurisdictional fact, it was an erroneous determination, it led him to conclude that he had no jurisdiction, and therefore it was a jurisdictional error. The determination was sufficient to conclude that he had no jurisdiction. The error does not cease to be a jurisdictional error because there was another, unnecessary basis to decline jurisdiction.
  1. [128]
    The adjudicator’s decision under s 84(2)(a)(i) was affected by jurisdictional error. This Court has jurisdiction to supervise and remedy jurisdictional error by an adjudicator under the BIF Act.
  1. [129]
    The implication of materiality discussed in Hossain and other authorities is a related, but different, matter to jurisdictional error. The implication of materiality depends on the particular statutory context and is concerned with whether an error or non-compliance in observing a statutory condition on the exercise of power should result in invalidity. The statutory context in this case is a scheme that includes Dualcorp issue estoppel. The determination of an issue that engages Dualcorp issue estoppel extends beyond the immediate adjudication process and, in a case like this, determines the right to make another payment under the Act, the right to make a future adjudication application and, therefore, the jurisdiction of a future adjudicator.
  1. [130]
    Such a determination is no small thing. The determination continues to operate. It is material to the decision on jurisdiction under s 84(2)(a)(i) if, as here, it is expressly relied upon to deny jurisdiction. In a statutory scheme that includes Dualcorp issue estoppel, it should be regarded as material.
  1. [131]
    If a jurisdictional error that is material is established, an issue arises whether the Supreme Court should rule that the decision affected by the jurisdictional error be declared void, in whole or in part. A stark choice between declaring the whole of a decision void and declining to grant any relief is not faced because, in a case like this, the Court may identify the part affected by jurisdictional error and declare it void, and allow the part of the decision not affected by jurisdictional error to remain binding.[44]
  2. [132]
    The existence of s 101(4) is a further reason why the question of materiality should not focus simply on a composite decision that is the product of an operative determination of jurisdiction that is affected by jurisdictional error and other findings that are not. If the ultimate decision is based on a determination affected by jurisdictional error, then the ultimate decision is affected by jurisdictional error. The presence of other grounds for the outcome may be relevant to the granting of relief. It does not alter the fact that the determination about jurisdiction is affected by jurisdictional error.
  1. [133]
    In this case, the decision that licensing requirements had been breached and therefore the adjudicator lacked jurisdiction was a jurisdictional error. It founded the decision under s 84(2)(a)(i) and it was material.
  1. [134]
    The question about what should be done to remedy the jurisdictional error is relatively simple. The jurisdictional error should be remedied by orders of the kind sought by Ingeteam, and before the erroneous decision on jurisdiction in relation to licensing affects Ingeteam’s statutory rights under the Act and its rights in the current adjudication process.
  1. [135]
    Finally, Susan River submits that to deny Ingeteam a remedy in this proceeding does not mean that it will be without a remedy or opportunity to later seek relief, because the payment scheme does not affect Ingeteam’s rights in any subsequent civil proceeding.[45] One must distinguish between rights under the general law and rights under the BIF Act. Unless remedied, the jurisdictional errors will affect Ingeteam’s rights under the statutory payment scheme in an immediate and significant way. Therefore, the relief sought by it should be granted without delay.

Summary and conclusion

  1. [136]
    The adjudicator made a decision that Ingeteam had engaged in unlicensed building work in undertaking a minor floor repair, and therefore he had no jurisdiction. That determination was made on the basis of submissions in reply and without giving Ingeteam the opportunity to give evidence or make submissions on the floor repair allegation. That issue was an important jurisdictional issue because the adjudicator’s licensing findings about the floor repair led him to conclude that he did not have jurisdiction. The adjudicator denied Ingeteam procedural fairness and therefore made a jurisdictional error. That jurisdictional error was material because there was a real possibility that a different decision about the existence of a construction contract would have been made, had Ingeteam been given the opportunity to submit that the floor repair was not work that required it to have a licence.
  1. [137]
    Uninformed by submissions from Ingeteam and in apparent ignorance of a relevant exemption in the Regulation about floor coverings, the adjudicator fell into error about whether Ingeteam had performed building work for which it required a licence. That finding was erroneous because the exemption in Item 30 of the Regulation applied.
  1. [138]
    Having concluded, however, that Ingeteam on one occasion had performed building work for which it required a licence, the adjudicator proceeded, on that sole basis, to find that a few years earlier Ingeteam had intended when entering into the Contract to not adhere to the requirements of s 42. This was an unjustified and unexplained conclusion. It was a damning conclusion that no reasonable decision-maker would have reached on the basis of the performance of unlicensed building work, in one trivial respect, a few years after the Contract had been entered into. It was not a conclusion that should have been reached in the face of evidence that Ingeteam had no such intention at the time the Contract was formed. Also, it was not a conclusion that was sought by Susan River.
  1. [139]
    In summary, the adjudication decision was affected by a denial of procedural fairness on a critical issue. The adjudicator made an erroneous decision that there was no valid construction contract because of alleged breaches of licensing requirements. He made a jurisdictional error in finding that a jurisdictional fact, namely a valid construction contract, did not exist.
  1. [140]
    The errors in relation to jurisdictional fact are jurisdictional errors. Those errors are material because the determination that there was no jurisdiction to hear an application based on the construction contract affected not only the adjudication application that the second respondent determined. By virtue of Dualcorp issue estoppel, the second respondent’s decision about jurisdiction, that immediately followed his licensing findings, effectively sterilises Ingeteam’s right to make a payment claim, and to pursue the current adjudication application that is due to be determined by the fourth respondent.
  1. [141]
    If the jurisdictional error is left uncorrected, it will affect the pending adjudication. The new adjudicator will have no real choice but to follow a decision on a fundamental issue going to jurisdiction.
  1. [142]
    In the context of legislation where the determination of an important jurisdictional issue has critical, practical consequences for a subsequent adjudication process, the jurisdictional error which I have found is material. Ingeteam should be granted the relief sought by it. Section 101(4) envisages that such an order may be made and it is appropriate to make the order.

Disposition and orders

  1. [143]
    I propose to make the orders sought in paragraph 1 of the originating application. In simple terms, the adjudication decision made by the second respondent will be declared void in part for jurisdictional error, namely those parts that contain the licensing findings. There will be a declaration that the applicant and the first respondent are not bound by the licensing findings. Subject to any submission as to costs, the first respondent will be ordered to pay the applicant’s costs of and incidental to the proceeding, including reserved costs. The other respondents abided by the Court’s decision and played no active part in the proceeding. There should be no order as to costs in relation to the costs of the second, third and fourth respondents.

Footnotes

[1] Dualcorp Pty Ltd v Remo Constructions Pty Ltd (2009) 74 NSWLR 190.

[2]Sutton v Zullo Enterprises Pty Ltd [2000] 2 Qd R 196 at [6].

[3]BIF Act, ss 70, 75 and 84(2)(a)(i); St Hilliers Property Pty Ltd v Pronto Solar Innovations Pty Ltd [2019] 2 Qd R 29 at [26]; Cant Contracting Pty Ltd v Casella [2007] 2 Qd R 13 at [30].

[4]Thiess Pty Ltd v Warren Brothers Earthmoving Pty Ltd [2013] 2 Qd R 75 at [101]; Fifty Property Investments Pty Ltd v O'Mara [2006] NSWSC 428 at [20]; Walton Construction (Qld) Pty Ltd v Salce & Ors [2008] QSC 235 at [7]; Walton Construction (Qld) Pty Ltd v Plumber by Trade Pty Ltd [2012] QSC 264 at [2] and [54].

[5][2000] 2 Qd R 196.

[6][2007] 2 Qd R 13.

[7][2021] QDC 322 (“Panel”).

[8]Panel at [30]-[32].

[9]Minister for Immigration and Multicultural and Indigenous Affairs v SGLB (2004) 78 ALJR 992 at 998 at [37]-[38].

[10]As to the meaning of matters “in reply” see Sanrus Pty Ltd v Monto Coal 2 Pty Ltd (No 4) [2019] QSC 199 at [17].

[11](2018) 264 CLR 123 at 135 [31].

[12] (2018) 264 CLR 123 (“Hossain”).

[13]Hossain at 134 [29].

[14]Hossain at 134 [30] (citations omitted). See also Nettle J at 137 [42] and Edelman J at 147 [71]-[72].

[15](2021) 390 ALR 590 at [30].

[16]At [38].

[17]At [38].

[18]At [39] (emphasis added).(2022) 403 ALR 398.

[19](2022) 403 ALR 398.

[20]At [33].

[21]At [45]-[46].

[22]At [80]-[81].

[23]At [90]-[91].

[24]Acciona Agua Australia Pty Ltd v Monadelphous Engineering Pty Ltd (2020) 4 QR 410 at 422 [34]; [2020] QSC 133 at 34 (“Acciona”).

[25][2010] 239 CLR 531 (“Kirk”).

[26] [1995] 184 CLR 163.

[27] Kirk at 573 [72].

[28] (2020) 4 QR 410.

[29]Hossain at 133 [25].

[30]At 133 [25].

[31] Compare Probuild Constructions (Aust) Pty Ltd v Shade Systems Pty Ltd (2018) 264 CLR 1 at [48].

[32](2009) 74 NSWLR 190.

[33][2014] QSC 223 (“Caltex Refineries”).

[34] [2010] QSC 159 at [38].

[35] [2023] QSC 245.

[36] At [59].

[37]Forte Sydney Carlingford Pty Ltd v Li [2022] FCA 1499 at [39]-[40].

[38]Caltex Refineries at [48]-[55].

[39]Thiess Pty Ltd v Warren Brothers Earthmoving Pty Ltd [2013] 2 Qd R 75 at [96] quoting Gedeon v Commissioner of the NSW Crime Commission (2008) 236 CLR 120 at [43].

[40]Thiess Pty Ltd v Warren Brothers Earthmoving Pty Ltd [2013] 2 Qd R 75 at [101]; Fifty Property Investments Pty Ltd v O'Mara [2006] NSWSC 428 at [20]; Walton Construction (Qld) Pty Ltd v Salce & Ors [2008] QSC 235 at [7].

[41]A matter that s 84(2)(a)(i) requires the adjudicator to decide.

[42]A matter that s 88(1)(a) requires the adjudicator to decide.

[43][2011] NSWSC 165 at [14]-[19].

[44]BIF Act, s 101(4).

[45] BIF Act, s 101.

Close

Editorial Notes

  • Published Case Name:

    Ingeteam Australia Pty Ltd v Susan River Solar Pty Limited & Ors

  • Shortened Case Name:

    Ingeteam Australia Pty Ltd v Susan River Solar Pty Ltd

  • MNC:

    [2024] QSC 30

  • Court:

    QSC

  • Judge(s):

    Applegarth J

  • Date:

    08 Mar 2024

  • Selected for Reporting:

    Editor's Note

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
4 citations
Caltex Refineries (Qld) Pty Ltd v Allstate Access (Australia) Pty Ltd [2014] QSC 223
2 citations
Cant Contracting Pty Ltd v Casella[2007] 2 Qd R 13; [2006] QCA 538
3 citations
Craig v South Australia (1995) 184 CLR 163
2 citations
Dualcorp Pty Ltd v Remo Constructions Pty Ltd (2009) 74 NSWLR 190
3 citations
Fifty Property Investments Pty Ltd v O'Mara [2006] NSWSC 428
3 citations
Forte Sydney Carlingford Pty Ltd v Li [2022] FCA 1499
2 citations
Gedeon v Commissioner of the NSW Crime Commission (2008) 236 CLR 120
2 citations
Hossain v Minister for Immigration and Border Protection (2018) 264 CLR 123
3 citations
John Holland Pty Ltd v Schneider Electric Buildings Australia Pty Ltd [2010] QSC 159
2 citations
Karam Group Pty Ltd v HCA Queensland Pty Ltd(2023) 17 QR 174; [2023] QSC 245
2 citations
Kirk v Industrial Court (NSW) (2010) 239 CLR 531
2 citations
Minister for Immigration and Multicultural and Indigenous Affairs v SGLB (2004) 78 ALJR 992
2 citations
MZAPC v Minister for Immigration and Border Protection (2021) 390 ALR 590
2 citations
Nathanson v Minister for Home Affairs (2022) 403 ALR 398
3 citations
Olympia Group (NSW) Pty Ltd v Hansen Yuncken Pty Ltd [2011] NSWSC 165
2 citations
Panel Concepts Pty Ltd v Tomkins Commercial & Industrial Builders Pty Ltd [2021] QDC 322
2 citations
Probuild Constructions (Aust) Pty Ltd v Shade Systems Pty Ltd (2018) 264 CLR 1
2 citations
Sanrus Pty Ltd v Monto Coal 2 Pty Ltd (No 4) [2019] QSC 199
2 citations
St Hilliers Property Pty Ltd v Pronto Solar Innovations Pty Ltd[2019] 2 Qd R 29; [2018] QSC 164
2 citations
Thiess Pty Ltd v Warren Brothers Earthmoving Pty Ltd[2013] 2 Qd R 75; [2012] QCA 276
4 citations
Walton Construction (Qld) Pty Ltd v Plumber by Trade Pty Ltd [2012] QSC 264
2 citations
Walton Construction (Qld) Pty Ltd v Salce [2008] QSC 235
3 citations
Zullo Enterprises Pty Ltd v Sutton[2000] 2 Qd R 196; [1998] QCA 417
3 citations

Cases Citing

Case NameFull CitationFrequency
Berkeley Building & Maintenance Pty Ltd v Totally Flooring Gold Coast Pty Ltd [2025] QCAT 3062 citations
Paladin Projects Pty Ltd v Visie Three Pty Ltd [2024] QSC 230 3 citations
Pico Play Pty Ltd v Coast Entertainment Operations Limited [2025] QSC 2276 citations
Procon Developments (Australia) Pty Ltd v Hi-Cal Bricklaying [2025] QSC 67 3 citations
1

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