Building and Construction Industry Security of Payment Act 1999 (NSW) – Adjudication determination quashed – failure to give adequate reasons
Category: Building and Construction Law
The Supreme Court of Victoria has found that a one-off special purpose company, incorporated for the sole purpose of carrying out a property development, was “in the business of building residences”, and therefore the Security of Payment Act applied to the dispute.
The High Court has handed down its decisions in the second and third cases concerning Security of Payments legislation to come before it. In Probuild v Shade Systems and Maxcon v Vadasz, the High Court affirmed that in New South Wales and South Australia, review is available for jurisdictional error but not for error of law on the face of the record.
In this recent decision the Court of Appeal considers builders’ duties under domestic building contracts to an undisclosed principal and owner, and the parties’ ability to limit the scope of the statutory warranties under the Domestic Building Contracts Act 1995 (Vic).
Victorian cases establish that a statutory payment claim is not invalid by reason of it being served before a reference date. These authorities are likely to be revisited in the light of recent decisions of the High Court of Australia and the New South Wales Court of Appeal.
This article considers the relevant Acts, Rules and Practice Notes that apply in appealing a VCAT decision, identifies the documents that must be prepared, and provides an overview of the relevant appeal steps.
In response to years of consumer complaints, the state government has implemented major reform in the domestic building area. Most notable is the introduction of a new mandatory dispute resolution process called DBDRV. This article will briefly explain the new procedure and identify some of its potential failings.
VCAT has ordered the owners to pay a builder $660,526.41 by way of a quantum meruit following the termination of a building contract; a sum which was “considerably more” than the builder might have recovered in a damages claim under the contract.
Paterson Constructions Pty Ltd v Mann  VCAT 2100
The New South Wales Court of Appeal has determined that an adjudicator’s decision under the Building and Construction Industry Security of Payment Act 1999 (NSW) is not amenable to judicial review for error of law on the face of the record, thus reversing the decision at first instance.
In response to years of consumer complaints, the state government is implementing major changes in relation to domestic building contracts and disputes in Victoria. Practitioners need to be aware of the new procedures and requirements.
The validity of an adjudication is conditional upon the adjudicator performing the statutory task of assessing the amount of construction work and its value. In the same case, judicial review in relation to the adjudicator’s alleged incorrect finding of an available reference date was pursued, but only formally in light of Lewence  NSWCA 288.
It has been held that automatic set off under s 553C of the Corporations Act 2001 (Cth) precludes companies in liquidation from taking advantage of the summary progress payment regime under the Building and Construction Industry Security of Payment Act 2002 (Vic).
In this recent decision, the Court of Appeal held that deleted words appearing on the face of an executed contract may not be used to interpret a clause unless the clause in question (excluding the deleted words) is ambiguous. If it is, the deleted words may be used, only, to assist in choosing between alternative constructions.
Security of Payment: What constitutes a “method of resolving disputes” and the adjudicator’s role in assessing value
In this recent decision, the Court of Appeal held that a mediation-based dispute resolution clause in a construction contract did not oust the jurisdiction of an adjudicator under Victorian security of payment legislation, and that an adjudicator is not bound by a valuation certified by a superintendent under a contract.