A recent decision of the Supreme Court of Queensland looked at the question: Does the Queensland Building and Construction Industry Payments Act 2004 (SOP Act) entitle a contractor to resubmit a previously unpaid payment claim with a new date and then make an adjudication application when the claim remains unpaid?
In the decision of Doolan v Rubikcon, the court held that whilst successive payment claims do not necessarily have to be for new or additional work, they cannot be identical. If a payment claim merely repeats an earlier claim it will not be valid and therefore cannot be adjudicated.
Basis for the court's finding
Rubickon was building a set of townhouses for the Doolans. Towards the end of the development Rubickon made a 'final claim' for payment, which was not paid. An adjudicator was appointed and determined that the money should not be paid because the adjudication application was not made within the time required by the SOP Act.
Rubickon then resubmitted the payment claim in the same form as the earlier claim, except for changing the invoice date and including the words 'Reissued 16 February 2006'. When the resubmitted claim was not paid, a second adjudicator was appointed. The adjudicator accepted the payment claim as valid, partly on the basis that the contract provided for submission of payment claims on the 20th of each month and the second payment claim (while identical), was a separate payment claim in respect of a different reference date. The contractor had not made multiple payment claims for a single reference date. An application was then made to the court for a judgment debt so that the adjudicator's certificate could be enforced.
Rubickon relied on the landmark NSW decision of Brodyn Pty Ltd v Davenport which provided that successive payment claims did not necessarily have to be for additional work. However, Brodyn was distinguished on the basis that the second claim was identical to the first. The court's logic appears to have been the second claim was really a second claim in respect of the original reference date and to find otherwise, would enable the contractor to overcome the time bar in commencing the adjudication for the original claim.
What does this mean?
Prior to this decision it was generally considered that if a claimant under the SOP Act (and its counterparts in NSW and Victoria) made an error in the procedure for making a payment claim or proceeding to adjudication, the claimant could just simply correct the error by resubmitting the claim (addressing the procedural deficiency) at the next month's payment claim. In Queensland (and probably NSW and Victoria) the claimant will now have to alter the claim in some way when it makes a claim in respect of the following reference date to make a valid claim. This may be difficult if there are no further monies to be claimed because the work was completed at the earlier reference date.
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