On 30 July 2013
we reported that the Supreme Court of Queensland had decided
that work carried out on land subject to a mining lease was not
'construction work' under the Building and Construction
Industry Payments Act 2004 (Qld) (BCIPA).
On 20 December 2013, the Queensland Court of Appeal (see J
& D Rigging Pty Ltd v Agripower Australia Ltd & Ors
 QCA 406) reversed that decision.
Supreme Court decision
BCIPA allows service of a payment claim for 'construction
work' performed pursuant to a 'construction
'Construction work' is defined in section 10 of BCIPA as
including work to be performed on buildings or structures that
'form part of land'.
J & D Rigging was engaged by Agripower to dismantle and
remove a mining plant based at the Skardon River Mine at Cape York.
The land on which the mining plant was located is subject to mining
leases that were granted in 1995 and due to expire in 2016.
J & D served Agripower with a payment claim under BCIPA for
In considering whether the mining plant 'formed part of
land' within the definition of section 10 of BCIPA, the Supreme
Court looked at the property law rules relating to fixtures. This
required analysis of matters outside the construction contract
– specifically looking at the intention of the parties
involved in affixing the mining plant to the land.
The Supreme Court concluded that the mining plant:
was affixed pursuant to a mining lease – and a mining
lease was not 'land' for the purposes of BCIPA;
merely provided stability for efficient operation;
was not intended to form part of or add any additional feature
to the land; and
formed part of the mining lease – not the land –
and therefore did come within the ambit of BCIPA.
Court of Appeal decision
In reversing the Supreme Court's decision, the Court of
Appeal found that the fact that the plant was constructed on land
subject to a mining lease, and the fact that a mining lease is not
'land' within the meaning of section 10 of BCIPA, did not
preclude a conclusion that the work in this case was construction
work on buildings or structures forming part of land for the
purposes of BCIPA.
The Court of Appeal stated that while mining leases may not be
legally categorised as 'land', the physical land on which
the building or structure stood did not change its character by
reason of the existence of a mining lease.
The Court of Appeal found that the requirements of the law of
real property about ownership of things affixed to land are not
imported into section 10 of BCIPA. Instead, the degree of
annexation to the physical land will be relevant to the issue of
whether or not a thing forms part of the land for the purposes of
In deciding that the plant did form part of land, the Court of
Appeal made the following findings:
BCIPA applies to construction work on temporary buildings or
structures provided they form part of land.
The plant consisted of numerous parts, which were set in or
bolted to concrete slabs.
The fact that the plant was affixed to the land for the purpose
of stability and efficiency of operation did not preclude a finding
that it formed part of land.
Despite the fact that the plant might have to be removed in the
future, it did not make it any less a feature of the land to which
it was affixed.
Although the plant had to be removed before the mining lease
expired, it formed part of the land on which it was constructed due
to the nature and degree of the affixation, and until the plant was
removed, it continued to form part of the land.
Accordingly, the Court of Appeal upheld the validity of J &
D's payment claim that had been declared invalid by the Supreme
The Court of Appeal's decision re-opens the door for BCIPA
payment claims to be made in relation to certain works conducted on
land subject to a mining lease.
Organisations submitting or responding to BCIPA claims in a
mining industry context may need to adjust processes to take into
account this recent decision.
The case also gives some guidance as to where works on temporary
buildings or structures can amount to 'construction work'
in a mining context, with the Court of Appeal indicating that the
same principles may be applicable to work involving factories,
warehouses and industrial plants that are capable of being
dismantled and may have a limited life.
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2012 (Best Brisbane Firm)
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Australian Law Firm (revenue less than $50m)
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