Generally, adjudicators will be given considerable
latitude as to the manner and form of their determination. The
recent Supreme Court of Queensland case of JAG Projects Qld Pty
Ltd v Total Cool Pty Ltd & Anor  QSC 211 is an
example of the application to the facts of well known principles of
the Queensland security of payment regime. The facts of the case
can be described in fairly short compass.
Total Cool Pty Ltd (First Respondent) was the beneficiary of an
adjudication decision under the Building and Construction
Industry Payments Act 2004 (Qld) ("the Act")
requiring JAG Projects Pty Ltd (Applicant) to pay $88,000.00. The
Applicant did not pay by the due date and the First Respondent
issued a statutory demand under the Corporations Act 2001
(Cth), which also went unpaid.
The Applicant sought a declaration that the adjudication
decision was void on the following grounds:
Two payment claims had been issued for the same work contrary
to section 17(4) of the Act;
The adjudicator failed to give sufficient reasons; and
The adjudicator failed to properly consider the Applicant's
The Applicant further contended that the First Respondent was
disentitled from using the security of payment regime as it was not
licensed under the Building and Construction Commission Act
1991 (Qld) at the time of making its payment claim, although
it was licensed when it entered into the contract and performed the
Bond J held that the payment claim was valid: there was only one
payment claim for the work as the First Respondent proceeded under
the invoice which was endorsed under the Act.
Although the First Respondent conceded that the
adjudicator's reasons were "sparse" his honour held
that as a whole, the adjudicator had demonstrated awareness of the
disputes between the parties and had "considered the
material" and expressed a conclusion in favour of the First
Respondent. This was not a situation where there was "a mere
indication by the adjudicator of having read the material and
[expressing] a conclusion as to satisfaction". His honour also
rejected the Applicant's contention that the First Respondent
was disentitled from using the regime established by the Act as the
First Respondent held the relevant licence at the time it undertook
to carry out the work subject to the payment claim.
This case demonstrates that it is important to engage early with
the core issues, which will ultimately prevent disputes from
arising and it is therefore important to seek legal advice early
rather than applying to the court for relief after an unsuccessful
The content of this article is intended to provide a general
guide to the subject matter. Specialist advice should be sought
about your specific circumstances.
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Warranties can be risk-shifting mechanisms when the party giving the warranty is not the party at fault for the defect.
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