Reference Dates: Who Decides?

By
Thursday, January 14th, 2016
liked this article
Embed
ACIF 300×250
advertisement
calendar
FavoriteLoadingsave article

In September and November of last year, the Courts of Appeal of Victoria and New South Wales each issued judgments on whether an adjudicator’s decision about a reference date is reviewable by a court on the ground of jurisdictional error.

The decisions of the two Courts appear inconsistent. The Victorian Court of Appeal decided that the fixing of a reference date by an adjudicator is reviewable by the Court as a jurisdictional fact. The New South Wales Court of Appeal held that the existence of a reference date to support a payment claim is not a jurisdictional fact, and therefore judicial review is not available.

So what is the current position regarding cases like these in Victoria, New South Wales and Queensland?

Victoria

In Saville v Hallmarc Construction Pty Ltd [2015] VSCA 318 (27 November 2015) the Victorian Court of Appeal found that the fixing of a reference date by an adjudicator is reviewable as a jurisdictional fact.

The underlying issue in the case was whether or not Saville’s payment claim had been served out of time. The payment claim was required to be served within three months of the reference date. The reference date was not straightforward to determine in this case.

The Court of Appeal found that the jurisdiction of the adjudicator was dependent upon the validity of the payment claim. If it was served out of time, it was invalid and could not ground the adjudicator’s jurisdiction. In this case, Saville’s right to a progress payment was dependent upon the fixing of a reference date. In turn, this required a characterisation of whether the first payment claim was a final payment claim or not. These matters involved questions of evaluation in relation to the scope of the construction contract and the timing of work undertaken within that scope. The Court found that the need for evaluation by the adjudicator, by reference to the evidence, does not preclude the fixing of a reference date from being a jurisdictional fact and thus reviewable.

The Court also commented that the strict observance of the procedural steps in the statutory scheme, including time limits, was mandated by the legislature as the price by which a claimant can take the benefit of the regime. It also noted that although the Act provides a “rough and ready” regime intended to be swift and conducted without undue formality, practical considerations and considerations of inconvenience are not determinative when deciding whether a requirement in the type of regime created under the Act is jurisdictional.

New South Wales

In Lewence Construction Pty Ltd v Southern Han Breakfast Point Pty Ltd [2015] NSWCA 288 (25 September 2015) the New South Wales Court of Appeal held that the existence of a reference date to support a payment claim is a matter for the adjudicator to decide. It is not a jurisdictional fact and cannot be the subject of judicial review.

The Court’s decision was based upon statutory interpretation of s8 and s13(1) of the Building and Construction Industry Security of Payment Act 1999 (NSW Act). The Court found that the words “or who claims to be entitled to a progress payment” in s13(1) make clear that the existence of a dispute as to the entitlement of a person to a progress claim does not preclude the making of a valid payment claim.

Essentially, the Court found that the existence of a reference date was a pre-condition to a claimant’s entitlement to a progress payment under s8(1) of the NSW Act, but was not a pre-condition to the validity of the payment claim under s13(1) of the NSW Act. The Court took into account the context of the NSW Act and the swift mechanism intended by the Act for the resolution of disputes relating to progress payments.

Thus, an error of fact by an adjudicator about whether the claimant has served more than one payment claim in respect of a reference date could be the subject of judicial review for jurisdictional error.

Queensland

The relevant provisions in the Building and Construction Industry Payments Act 2004 (QLD) are similar to both NSW and Victoria.

The decision of Applegarth J in Lean Field Developments Pty Ltd v E & I Global Solutions (Aust) Pty Ltd [2014] QSC 293 suggests the Queensland position is inconsistent with Lewence and more likely to be aligned with Saville.

In Lean Field Applegarth J, it was determined that jurisdictional error will arise where one of the requirements for a valid payment claim under the Act is not met, and that one such requirement is that a reference date has arisen under the contract at the time the payment claim is made.

Applegarth J proceeded to find that a reference date had arisen at the time the relevant payment claim was made under the Act and, as a result, the adjudicator had jurisdiction to determine the adjudication proceeding.

The Courts in NSW are taking a robust approach to the enforcement of adjudicators’ decisions with the result that technical legal arguments may fail. In Victoria and Queensland, the Courts are more inclined to intervene post-adjudication and have given less weight to the intention of the SoP legislation.

Embed
FavoriteLoadingsave article

Comments

 characters available
*Please refer to our comment policy before submitting
Discussions