Grocon Constructors (Grocon) engaged PlanIT Cocciardi Joint
Venture (PlanIT) to provide drafting services for the construction
of the Melbourne Rectangular Stadium. A dispute arose as to the
validity of a payment claim served by PlanIT under the Building and
Construction Industry Security of Payment Act 2002 (Vic) (SOP
PlanIT served a payment claim on Grocon for the amount of
$554,841 for work completed between September and December
Grocon responded that PlanIT was not entitled to the amount as
the payment claim contained an 'excluded amount', as
defined under the SOP Act, and was therefore invalid.
PlanIT referred the dispute to adjudication in May 2009. The
adjudicator determined that PlanIT was entitled to the full amount.
Grocon then sought a review of the adjudication determination under
the SOP Act. The review adjudicator upheld the initial
Grocon was successful in obtaining an injunction to restrain
PlanIT from enforcing the review determination. Grocon then issued
proceedings for judicial review in the Supreme Court of Victoria
seeking to quash decisions of both the adjudicator and review
adjudicator on the basis of jurisdictional error.
The two key and related issues to be decided by Justice Vickery
Whether decisions made by adjudicators and review adjudicators
under the SOP Act are subject to judicial review.
Whether the Court had jurisdiction to grant judicial
SUPREME COURT DECISION
Are adjudicators subject to judicial review?
His Honour concluded that adjudicators' decisions were
subject to judicial review as:
Adjudicators had the legal authority to determine questions
affecting the common law or statutory rights or obligations of
Adjudicators were public bodies.
Does the Court have jurisdiction to grant judicial review?
In determining whether the Court had jurisdiction to grant
judicial review, Justice Vickery analysed the position adopted in
New South Wales, where there have been a number of cases on this
In the New South Wales case of Brodyn Pty Ltd (trading as Time
Cost and Quality) v Davenport & Another (Brodyn), it was held
that the NSW SOP Act had an implied intention to oust the
The Court found that the legislative intention of the NSW SOP
Act was to provide a mechanism to ensure that disputes concerning
amounts of payments are resolved with minimum delay. Since judicial
review is not consistent with the legislative intention, the Court
did not have jurisdiction to grant such review.
Does the principle in Brodyn apply in Victoria?
Justice Vickery determined that the principle in Brodyn did not
apply in Victoria. Under the Constitution Act 1975 (Vic)
(Constitution Act) the Court has jurisdiction to grant judicial
review unless there is an express intention to remove that
Even though the Victorian SOP Act has a similar purpose to the
NSW SOP Act, it does not seek to expressly remove the Court's
jurisdiction to grant judicial review. Accordingly, the Victorian
Supreme Court has jurisdiction to grant judicial review of
decisions made under the Victorian SOP Act.
Interestingly, whilst Justice Vickery noted that the statements
of law in Brodyn were persuasive and, in fact, desirable, to
achieve uniformity within the national building framework, the
principal in Brodyn could not and should not be adopted in Victoria
by virtue of the Constitution Act.
Although Justice Vickery dismissed Grocon's claims, this is
an important decision in regards to the SOP Act. The decision means
that in Victoria, parties to an adjudication may seek judicial
review of decisions made by adjudicators.
The option to seek judicial review may impact on the SOP
Act's stated purpose, namely, the prompt resolution of payment
Justice Vickery noted that one way to rectify this situation
would be to amend the SOP Act so that it expressly removes the
jurisdiction of the court to grant judicial review. However, until
this occurs, this decision will bind courts in Victoria.
The SOP Act was generally seen as affecting a shift in the
balance of power between principals and contractors back towards
the contractors, as it allowed contractors to promptly receive
progress payments and to quickly resolve any disputes.
This decision arguably shifts the balance of power back towards
the principals (and head contractors), as it provides another
avenue which they can review unfavourable decisions.
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This publication is intended as a first point of reference and
should not be relied on as a substitute for professional advice.
Specialist legal advice should always be sought in relation to any
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