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J.R. & L.M. Trackson Pty Ltd v NCP Contracting Pty Ltd & Ors  
Unreported Citation: [2019] QSC 201
EDITOR'S NOTE

This case involved an application for orders setting aside, or declaring void, an adjudication decision (made pursuant to the Building and Construction Industry Payments Act 2004). The applicant alleged that the claimant had improperly made more than one payment claim when it served three invoices, or alternatively that it had lodged more than one adjudication application (if there were only one claim). Justice Ryan found that, viewed objectively, only one payment claim had been lodged; further, that the filing of a later adjudication application would not invalidate an earlier one (which was the application that had been determined here). In any event, that relief would be denied on discretionary grounds. Her Honour also considered arguments that a “conference of the parties” could not involve witnesses, and could not involve the making of “submissions”. Her Honour rejected those arguments, finding that their endorsement would deprive a conference of utility, and would therefore be inconsistent with the purpose of the Act.

Ryan J

21 August 2019

Background

The respondent, NCP, entered into a contract with the applicant, Trackson, to construct a gravity sewer main. [1]. On 27 September 2018, NCP served on Trackson (by way of email) three invoices, each of which “expressly stated to be a [payment] claim” made under the now repealed Building and Construction Industry Payments Act 2004 (“the Act”). [13], [16]. In its response, Trackson proposed to pay $0 in relation to those invoices. [21]. Subsequently, NCP brought an adjudication application in respect of two of the invoices, with the adjudication being ultimately determined in its favour. [1].

Trackson commenced this proceeding seeking an order setting aside, or declaring void, the adjudication decision, on a number of grounds. In substance, the issues related to whether NCP had served more than one payment claim in respect of the same reference date, or, if only one claim had been served, whether it had filed more than one adjudication claim; and whether a conference called by the adjudicator was not held in accordance with the Act because it involved a person who was not a party, or because the adjudicator took into account submissions contrary to s 26(2). [2].

The number of claims / adjudication applications

Under the Act, a claimant may not serve more than one payment claim for each reference date under the construction contract (per s 17(4)). [52]. Trackson submitted that the three invoices represented three separate payment claims, rather than one as required. [57].

Ryan J reviewed a number of cases in which a similar issue had arisen including Alan Conolly & Co v Commercial Indemnity Pty Ltd [2005] NSWSC 339 and Tailored Projects Pty Ltd v Jedfire Ltd [2009] 2 Qd R 171. [73] and [78]. Those decisions emphasised the need for a focus on substance over form, and the need for a “common sense and reasonable approach”. [83], [92].

Having regard to the substance of the documents, and how they were likely to be reasonably understood by their recipient, her Honour concluded that the three invoices represented “one payment claim”. [101]–[102]. In so concluding, her Honour particularly emphasised that the invoices were sent collectively under one email cover, concerned work under the same construction contract, and referenced the same project. [103]. 

Her Honour then considered Trackson’s alternative argument: if there was only one payment claim (as found), then NCP had served more than one adjudication application for that claim (contrary to s 21 of the Act). [106]. However, her Honour found that the adjudication application that was actually determined was the first of the two that were made; the second one was not determined by the adjudicator. [120], [122]. In the absence of any authority to support the argument that the making of the second application invalidated the first, her Honour was prepared to treat the first application as valid. [122]. Further, her Honour said that even if she were wrong in this conclusion, she would “exercise my discretion to withhold relief” on the basis that the lodging of more than one adjudication application had been “encouraged by Trackson”. [128].

The conference

Trackson argued that a conference called by the adjudicator, and attended by a “witness”, had resulted in jurisdictional error in the adjudication decision for two reasons: firstly, because s 25(3)(d) of the Act only permitted a conference of “the parties”, which did not permit attendance by a witness; and secondly, because s 26(2)(c) of the Act only permitted the adjudicator to consider submissions “properly made”, which did not include submissions made at a conference. [133]–[137].

Ryan J found that those who may attend a conference under the Act were not limited to the parties. Her Honour concluded (at [164]):

“In my view, for a conference to have utility, having regard to the purposes of the Act and the paradigm types of disputes over payment claims, those in attendance at a conference must be able to quickly provide information in response to an adjudicator’s questions. In my view, witnesses other than the parties, with relevant expertise or factual knowledge, may be in attendance at a conference of the parties.”

As to whether “submissions” may be made at a conference, her Honour noted that Trackson had been unable to identify the difference between “clarifying issues” (which it said was permissible) and “making submission” (which it said was impermissible). [166]. However, her Honour considered that an “appropriately broad view of the meaning of the word ‘submissions’” required it to include the “offering of an oral response to questions of fact or law posed by an adjudicator” at a conference. [167]–[168]. Her Honour said that, if it were otherwise, “[o]ne may ask rhetorically, what is the point in permitting the adjudicator to seek out further information [by way of a conference]”? [194]. To refuse to permit an adjudicator to consider the information obtained at a conference would “deprive those sections of purpose”. [195]. Accordingly, there was no error in the conduct of, or use of information obtained through, the conference. [198].

In the result, no jurisdictional error had been made out. The application was dismissed. [199].

W Isdale