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SNAPSHOT FROM SAT
Reviewing the adjudicator’s decision to dismiss an application without
making a determination of its merits under s.31(2)(a) of the
Constructions Contracts Act 2004 (WA)
LISA WARD
LEADR & IAMA (WA) DETERMINATIVE FORUM 19 AUGUST 2014
ABOUT THE PRESENTER – LISA WARD
▪ Lisa has a B.Juris, LLB and a Master of Laws from the University of Western Australia
▪ She has 25 years legal experience and is admitted as a solicitor in both Western Australia and England
▪ She is a nationally accredited and experienced mediator
▪ Lisa is a member of the State Administrative Tribunal and in that capacity she has reviewed numerous applications under section 46 of the Construction Contracts Act 2004 (WA)
▪ Contact: [email protected]
OBJECTIVE
ADJUDICATORS WILL LEAVE THIS EVENING KNOWING MORE ABOUT:
▪ The role of the Tribunal under the Constructions Contracts Act 2004 (WA) (‘CCA’)
▪ Common jurisdictional issues arising in SAT and how to avoid them
OVERVIEW▪ The role of the Tribunal under the Constructions Contracts Act 2004
(WA) (‘CCA’):
▪ SAT SOURCES OF JURSIDCITON – ENABLING ACTS, CCA IS AN ENABLING ACT
▪ SAT’S ROLE – REVIEW JURISIDCTION, HEARING DE NOVO, CORRECT & PREFERABLE DECISION
▪ LIMITED RIGHT OF REVIEW IN SAT UNDER S.46(1)CCA
▪ Common jurisdictional issues arising in SAT under s. 31(2)(a) of the CCA and how to avoid them
SOURCES OF JURISDICTION
▪ SAT CREATED BY STATUTE
▪ JURISDICTION EXPRESSLY CONFERRED ON SAT BY ENABLING ACT
▪ NO INHERENT JURISDICTION
…
CCA IS AN ENABLING ACTSTANDING & JURISDICTION
▪ Section 46 of the CCA
Review, limited right of
(1) A person who is aggrieved by a decision made under section 31(2)(a) may apply to the State Administrative Tribunal for a review of the decision.
…See: s.20 SAT Act & Rule 9 of SAT Rules – application for review within 28 days of notice of the decision and of the right to review
SAT’S ROLE IN PERSPECTIVE
• < 3% OF ALL ADJUDICATIONS ARE SUBJECT TO REVIEW BY SAT (35/1186)
• ABOUT 14% OF DISMISSALS BY ADJUDICATORS WERE THE SUBJECT OF REVIEW IN SAT IN 2013-14 (7/47)
• APPLICATIONS FOR REVIEW ARE DISMISSED BY SAT MORE OFTEN THAN NOT
REFERENCES: REPORT OF THE BUILDING COMMISISONER FOR THE FINANCIAL YEAR 30 JUNE 2014 & AUSTLII
REVIEWABLE DECISION
S. 17 OF THE SAT ACT
What comes within review jurisdiction
(1) If the matter that an enabling Act gives the Tribunal jurisdiction to deal with is a matter that expressly or necessarily involves a review of a decision, the matter comes within the Tribunal’s review jurisdiction.…
(3) Where subsection (1) or (2) applies the decision is a reviewable decision for the purposes of this Act.
HEARING DE NOVO
S. 27 OF THE SAT ACT
Nature of review proceedings
(1) The review of a reviewable decision is to be by way of a hearing de novo, and it is not confined to matters that were before the decision-maker but may involve the consideration of new material whether or not it existed at the time the decision was made.
(2) The purpose of the review is to produce the correct and preferable decision at the time of the decision upon the review.
(3) …
HEARING DE NOVO CONTINUED
▪ SAT STANDS IN THE SHOES OF THE ADJUDICATOR
▪ SAT REQUIRED TO MAKE CORRECT & PREFERABLE DECISION
▪ CONSIDERATION OF ALL GROUNDS UNDER S. 31(2)(a) of CCA – may result in a decision by SAT to dismiss for different reasons
▪ NEED TO READ S.27 DOWN TO THE EXTENT OF ANY INCONSISTENCY
Marine and Civil Bauer Joint Venture and Leighton Kumagai Joint Venture [2005] WASAT 269, THIESS PTY LTD -v- MCC MINING (WESTERN AUSTRALIA) PTY LTD [2011] WASC 80 AT [16] & [17] OBITER,
RELATIONSHIP BETWEEN SAT ACT AND CCA
S. 18 OF THE SAT ACT
Exercising review jurisdiction(1) In exercising its review jurisdiction the Tribunal is to deal
with a matter in accordance with this Act and the enabling Act.
(2) The enabling Act may modify the operation of this Act in relation to a matter that comes within the Tribunal’s review jurisdiction.
S.31(2)(A) OF THE CCA31 . Adjudicator’s functions…..…(2) An appointed adjudicator must, within the prescribed time or any extension of it made under section 32(3)(a) —
(a) dismiss the application without making a determination of its merits if —
(i) the contract concerned is not a construction contract;
(ii) the application has not been prepared and served in accordance with section 26;
(iii) an arbitrator or other person or a court or other body dealing with a matter arising under a construction contract makes an order, judgment or other finding about the dispute that is the subject of the application; or
(iv) satisfied that it is not possible to fairly make a determination because of the complexity of the matter or the prescribed time or any extension of it is not sufficient for any other reason;
….
THE CONTRACT CONCERNED IS NOT A CONSTRUCTION CONTRACT
S.31(2)(A)(I)
Fundamental concepts: 'construction contract‘
• The subject to which the Act applies is a 'construction contract‘• Term is defined by the detailed provisions of s 3 - s 5 of the Act• A proper understanding of the term demands attention to the
entirety of the definitional provisions• Written contract not required
SEE:FIELD DEPLOYMENT SOLUTIONS PTY LTD -v- SC PROJECTS AUSTRALIA PTY LTD [2015] WASC 60 at [26] to [30]
THE APPLICATION HAS NOT BEEN PREPARED AND SERVED IN
ACCORDANCE WITH SECTION 26S.31(2)(A)(II)
• BY FAR THE MOST COMMON GROUND OF DISMISSAL REVIEWED BY SAT
• WHAT DOES S.26 OF CCA REQUIRE FROM A PARTY TO THE CONTRACT?
• WHO CAN APPLY FOR ADJUDICATION? S.25 CCA
S.25 CCASTANDING – WHO CAN APPLY FOR ADJUDICATION
S. 25 of the CCA REQUIRES THE EXISTENCE OF ALL OF THE FOLLOWING :
▪ ‘payment dispute’
▪ ‘construction contract’
▪ ‘payment claim’
▪ a payment dispute arises under the ‘construction contract’ (ie not quantum meruit claims)
any party to the contract
See: Delmere Holdings Pty Ltd v Green [2015] WASC 148 per Kenneth Martin J
S.26 CCA REQUIREMENTS IS THERE A PAYMENT DISPUTE?
▪ APPLICATION IS FOR A PAYMENT DISPUTE TO BE ADJUDICATED
▪ PAYMENT DISPUTE IS DEFINED IN S.6 OF CCA
… a payment dispute arises if -
(a) by the time when the amount claimed in a payment claim is due to be paid under the contract, the amount has not been paid in full, or the claim has been rejected or wholly or partly disputed …
S.26 CCA REQUIREMENTS IS THERE A PAYMENT CLAIM?
▪ THE TERM ‘PAYMENT CLAIM’ IS DEFINED IN S.3 OF CCA
[a] claim made under a construction contract ... by the contractor to the principal for payment of an amount in relation to the performance by the contractor of its obligations under the contract.
▪ Relates to work done or ‘performance’ ‘under the contract’
▪ ie a particular amount is claimed for particular work which has been performed
SEE: LAING O'ROURKE AUSTRALIA CONSTRUCTION PTY LTD -v- SAMSUNG C & T CORPORATION [2015] WASC 237 at [30] –[31] per Mitchell J
S.26 CCA REQUIREMENTS PAYMENT CLAIM CONTINUED
▪ Payment claims cannot be repeated
SEE: DPD PTY LTD -v- McHENRY [2012] WASC 140 at [42] and [56] applying
Georgiou Group Pty Ltd and MCC Mining (Western Australia) Pty Ltd [2011] WASAT 120, (2011)_77_SR_(WA)_112[1]
▪ Query if the payment claim must be made in accordance with the terms of the contract – effect of conditions precedent to payment claim. Is there a divergence of views?
S.26 CCA REQUIREMENTS WAS THE APPLICATION FOR ADJUDICATION MADE WITHIN 28 DAYS OF THE PAYMENT DISPUTE ARISING?
COMPUTATION OF TIME UNDER s 26(1) of the CC Act:
▪ Was the application for adjudication within 28 days after the payment dispute arises?
▪ When did the payment dispute arise?
▪ When was the payment claim made?
SEE: THE MCIC NOMINEES TRUST T/As CAPITAL PROJECTS & DEVELOPMENTS and RED INK HOMES PTY LTD [2013] WASAT 177 AT [46]
SEE: INTERPRETATION ACT 1984 – SECT 61 . Time, computation of &
s. 23 of CCA Implied provisions: interpretation etc
S.26 CCA REQUIREMENTS WAS THE APPLICATION FOR ADJUDICATION MADE WITHIN 28 DAYS OF THE PAYMENT DISPUTE ARISING? CONTINUED
IMPLIED PROVISIONS - impact on the counting of days
▪ Part 2 'Content of construction contracts' of the CC Act
▪ Div 2 'Implied provisions'.
▪ S. 16 Making claims for payment, S. 17 Responding to claims for payment, S. 18 Time for payment
▪ Schedule 1 'Implied provisions' , Div 5 'Responding to claims for payment' of the CC Act cl 7 Responding to a payment claim.
▪ Cl 7(1) notice of dispute within 14 days of receiving the payment claim
▪ Cl 7(3) unless disputed – must pay within 28 days after a party receives a payment claim
S.26 CCA REQUIREMENTS26(2) APPLICATION PREPARED IN ACCORDANCE WITH THE REGULATIONS
▪ S. 26(2)(a) CCA – must – mandatory
▪ CONSTRUCTION CONTRACTS REGULATIONS 2004 - REG 5 - Prescribed information in application for adjudication
REG 5 For the purposes of section 26(2)(a) of the Act, an application to have a payment dispute adjudicated must, in addition to the other information required by section 26(2) of the Act, contain —
(a) the name of the appointed adjudicator or prescribed appointor and the adjudicator’s or appointor’s contact details;
(b) the applicant’s name and contact details; and
(c) the respondent’s name and contact details.
REG 4 . Giving a person’s contact details
If a person is required by these regulations to give the contact details of a person, the person required to give the details must give the address, telephone and facsimile numbers and ABN of the person or the person’s business (or ACN of the person if there is no ABN) to the extent to which the person required to give the details knows those details.
S.31(2)(A)(III) OF THE CCAORDER, JUDGMENT OR FINDING
(iii) an arbitrator or other person or a court or other body dealing with a matter arising under a construction contract makes an order, judgment or other finding about the dispute that is the subject of the application; or
▪ Does an ‘order’ mean final or interlocutory or programming order?
S.31(2)(A)(IV) OF THE CCA –COMPLEXITY OF THE MATTER ETC.
(iv) satisfied that it is not possible to fairly make a determination because of the complexity of the matter or the prescribed time or any extension of it is not sufficient for any other reason;
▪ HOW IS COMPLEXITY MEASURED? Dollar amount of the payment dispute, volume of material, level of technical difficulty?
TAKE HOME MESSAGES
Common jurisdictional issues arising in SAT and how to avoid them
▪ Count the days carefully – most matters in SAT deal with whether applications for adjudication are made within 28 days of the payment dispute arising. Your calendar is your friend
▪ Know when and how the implied provisions apply
▪ Query the inter- relationship between CCA and SAT Act and the extent of any procedural fairness obligations
THE END!
THANK YOU FOR YOUR TIME
