A fork in the adjudication road - which way do you go?

A fork in the adjudication road - which way do you go?

Neumann Contractors Pty Ltd v Peet Beachton Syndicate Limited [2009] QSC 376

When a Claimant makes a Payment Claim under the Building and Construction Industry Payments Act 2004 (“BCIPA”) and the Respondent fails to serve a payment schedule the Claimant has the option to either:

(a) Recover the amount of the claim as a debt through the courts; or

(b) Give a notice and then proceed to make an Adjudication Application in respect of the claim.

Neumann Contractors Pty Ltd (“Neumann”) recently faced that option and elected to make an application to the Court for judgment in the amount of $602,893.20 against Peet Beachton Syndicate Limited (“Peet”) .

Peet argued that Neumann was not entitled to judgment because (among other things) the Payment Claim was not valid in that it did not identify the construction work to which the claim related as required by the BCIPA. Neumann had included in its claim an amount of $467,775.37 identified as “Add previously claimed & unpaid”. Justice White found that the Neumann’s failure to provide particulars of that amount would have required Peet to undertake a careful analysis of the schedules to the payment claim to decide whether it should respond. Her Honour found that this would require Peet to undertake the kind of research which would be subject to error and to do so within the time constraint of 10 business days under the BCIPA. This lead her Honour to conclude that the Payment Claim did not identify the construction work to which the claim related as required by the BCIPA.

Accordingly, Neumann’s application for judgment was dismissed.

Perspectives

One wonders whether an adjudicator would have adopted the Court’s stringent interpretation of the BCIPA requirement that the Payment Claim identify the construction work. In our experience, it would be unlikely that an adjudicator would accept the argument advanced by the Respondent.

If a Claimant elects to proceed with the option of making an application to the courts for judgment, it must ensure that its Payment Claim strictly complies with the BCIPA in every aspect. This is especially so now that the trend in the case authorities this year has been to seek to limit Claimants from making multiple Payment Claims.