Security of payment laws can be effective for getting
construction contractors paid quickly for the work that they
But sometimes it is necessary to challenge an adjudicator's
decision. Appeal rights are very limited in the legislation.
Since these laws were introduced around Australia in the late
1990s, it has generally been accepted that an adjudicator's
decision cannot be challenged in a court just because of a
misunderstanding of the law. In order to be challenged, the
adjudicator had to have made a decision that they had no power to
make at all.
One NSW Judge has cast doubt on this generally accepted view,
though. According to Justice Emmett in Probuild Constructions
(Aust) Pty Ltd v Shade Systems Pty Ltd  NSWSC 770, the
Supreme Courts have inherent powers to review the decisions of
statutory decision makers (including adjudicators) and it would
require clear words in security of payment legislation to take
those powers away.
Such clear words simply do not appear in NSW security of payment
legislation, according to this NSW Supreme Court decision.
The decision, and any appeal decision that follows, may open the
way for increased challenges against determinations of construction
payment disputes by adjudicators in WA as well. At least, in our
view, there is nothing in the security of payment provisions of our
Construction Contracts Act that expresses any more
clearly, an intention to take away the Court's review powers,
than there is in the NSW equivalent.
Unless and until the WA Supreme Court expresses its agreement
with this view, however, the scope of judicial review in WA will
remain uncertain. And it would take a large payment claim to
justify running a test case of this kind in WA. But the first step
has now been taken in the journey towards greater judicial
intervention in the adjudication of construction payment
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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