Declaration of interest: Colin Biggers & Paisley (CBP)
acted for State Asphalt Services Pty Limited (SAS)
In brief - Claimant's right to summary judgment upheld
The NSW Supreme Court has upheld a claimant's right to
summary judgment under the Security of Payment Act where
no payment schedule was served in response to a payment claim, even
though a payment schedule is provided to a subsequent, identical
Leighton does not issue payment schedules in response to
initial payment claim from SAS
In October 2012, SAS served a further payment claim under the
Act on Leighton in identical terms to the June payment claim.
Leighton responded to this payment claim with a payment schedule
under the Act.
SAS thereafter commenced proceedings for summary judgment under
section 15(2)(a)(i) of the Act for the amount of the June
Leighton opposed this on a number of grounds, which came before
Justice Stevenson of the Supreme Court of NSW for
Supreme Court determines that SAS has accrued right to obtain
In his judgment of 9 May 2013, his Honour held that:
Leighton's failure to provide a payment schedule in
response to the June payment claim gave SAS an accrued right to
obtain judgment for the amount of that claim under the Act;
the making of the October payment claim in identical form did
not affect that accrued right even though Leighton had an
opportunity to (and did) serve a payment schedule in response to
the October payment claim.
Plaintiff did not abuse the Security of Payment Act or
Stevenson J also determined that because SAS's accrued right
under the June payment claim was not extinguished by the Act,
SAS' conduct did not constitute an abuse of the Act. Likewise,
SAS was exercising a right conferred by the Act and its mere
knowledge that Leighton disputed the claim was not sufficient to
make the proceedings for summary judgment an abuse of the processes
of the court.
This is a significant decision that clarifies an area not
squarely addressed by existing authority.
Some ambiguity still remains for Security of Payment
The case involved separate payment claims (albeit for identical
amounts) made on two separate reference dates under the contract.
It is important to distinguish that situation with one in
If, as part of this process, the respondent then served a
payment schedule in accordance with the further right afforded by
section 17(2)(b) of the Act, it is arguable that the claimant
could not then have gone back to pursue its initial right to
summary judgment under section 15(a)(i).
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