Australia: Judicial Review under the Security of Payment Act: A win for the principal

Last Updated: 15 December 2009
Article by Jane Hider and Dean Bao


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 Act).

PlanIT served a payment claim on Grocon for the amount of $554,841 for work completed between September and December 2008.

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 determination.

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 were:

  • 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 review.


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 individuals.
  • 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 issue.

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 Court's jurisdiction.

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 jurisdiction.

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 claims.

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.

© DLA Phillips Fox

DLA Phillips Fox is one of the largest legal firms in Australasia and a member of DLA Piper Group, an alliance of independent legal practices. It is a separate and distinct legal entity. For more information visit

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 particular circumstances.

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