Sunshine Coast Regional Council v Earthpro Pty Ltd & Ors [2015] QSC 168

Significance

A declaration of partial invalidity can be made in respect of an adjudication decision if the proceedings to challenge the decision were brought before 15 December 2014.

Facts

Earthpro Pty Ltd (first respondent) was contracted by the Sunshine Coast Regional Council (applicant) to carry out earthworks at a landfill site. Practical completion had not been achieved by 26 March 2014, at which time the applicant terminated the contract. Four months later the first respondent submitted a payment claim seeking more than $3 million dollars. The applicant accepted liability of less than $6,500.

The first respondent submitted an adjudication application in August 2014. The adjudicator (second respondent) determined that the applicant was liable for $1.4 million, of which $1.081 million comprised delay costs related to extension of time (EOT) claims.

The applicant raised the following grounds in contending that the adjudication decision was void for jurisdictional error:

  • the second respondent exceeded his jurisdiction in allowing EOT claim 10 as it was a re-agitated claim; 
  • there had been a denial of procedural fairness in respect of EOT claims 18 and 19, which were incorrectly noted in the adjudication decision as being made before termination; and
  • the adjudicator's assessment of compensation for delay under clause 36 of the contract (claimed on a global basis) was egregiously erroneous.

Decision

Byrne SJA held that part of the adjudication decision involved jurisdictional error on the first of the 3 grounds as the factual foundations underpinning EOT claim 10 were fundamental to a previously determined variation claim. He found that the first respondent had re-agitated issues that were essential in the determination of a previous adjudication, with the result that the adjudicator had exceeded his jurisdiction.

His Honour therefore had to consider whether section 100(4) of the Building and Construction Industry Payments Act 2004 (Qld) (Act), proclaimed after the application was filed, applied to permit a declaration of partial invalidity in respect of the adjudication decision. To this end, His Honour considered that the inclusion of section 100(4) as part of the transitional version of the Act applying to any outstanding matters evinced a legislative intent that section 100(4) of the Act applied to proceedings such as this one.