Irish Bentley Lawyers was recently involved in the decision of Iris Broadbeach Business Pty Ltd v Descon Group Australia & Anor [2024] QSC 16 in relation to a further dispute between a Principal and Contractor arising out of a payment claim and subsequent adjudication under the Building Industry Fairness (Security of Payment) Act 2017 (Qld).
While less of a factual dispute than the previous decision of Justice Williams in Iris Broadbeach Business Pty Ltd v Descon Group Australia Pty Ltd & Anor [2023] QSC 290, this matter highlights a few key considerations for both Principals and Contractors when engaging in the adjudication process under the Act.
The three key question before the Court were:
- Did the Adjudicator fail to afford the Principal procedural fairness and fail to consider submissions about the effect of a clause of the contract on the retention of monies otherwise payable to the Contractor;
- Did the Adjudicator fail to consider s. 87(2) of the Act where the Principal contended that that the value of the work, or the goods and services, had changed since the Adjudicator’s previous decision; and
- Was the Payment Claim a valid payment claim under s 68 of the Act where, on the Principal’s case, it did not explicitly make a request for payment
Ultimately, her Honour Justice Wilson found against the Contractor on the first two points but found in favour of the Contractor in relation to the validity of the Payment Claim for the purposes of s 68.
This decision usefully provides certainty for Contractors around the requirements for what constitutes a payment claim for the purposes of s. 68 of the Act. It also highlights for those in the profession the importance of considering the intersection of mandatory and non-mandatory language in the Act and how that choice interplays with the overarching purpose of the Act and the “very valuable, and commercially important, advantages” provided to Contractors.
Conversely, this decision also demonstrates the increasing willingness of Principals to bring applications to void adjudication decisions where, through no fault of the Contractor, the adjudicator may have fallen into jurisdictional error.
As projects continue to grow in value, the quantum and complexity of payment claims increase and the importance of cashflow to Contractors becomes increasingly critical, one has to wonder when disputes over payment turn into long and protracted technical disputes, if the purposes of the adjudication process and the Act is being achieved.
For those in the construction industry from Principals, Contractors or Sub-Contractors, Irish Bentley Lawyers offers tailored solutions to your construction-based disputes and can provided specialised advice in relation to the progression of payment claims through adjudication.
If you wish to make a booking to speak with one of our Construction Lawyers then please contact us at mail@irishbentley.com.au or via phone on +614 7 3229 4060.