Southern Han Breakfast Point Pty Ltd (in liquidation) v Lewence Construction Pty Ltd & Ors [2016] HCA 52

This morning the High Court handed down judgment in Southern Han Breakfast Point Pty Ltd (in liquidation) v Lewence Construction Pty Ltd & Ors [2016] HCA 52, unanimously allowing an appeal from the New South Wales Court of Appeal (NSWCA).

In its first ever consideration of the Building and Construction Industry Security of Payment Act 1999 (NSW) (SOP Act), the High Court overturned the decision of the NSWCA in Lewence Construction Pty Ltd v Southern Han Breakfast Point Pty Ltd [2015] NSWCA 288. In that case, the NSWCA found that the existence of a reference date was not a jurisdictional fact or a precondition for the making of a valid payment claim, and therefore that an adjudicator had jurisdiction to determine a dispute about the existence of a reference date.

The High Court disagreed with the NSWCA, construing the reference in section 13(1) of the SOP Act to a ‘person referred to in section 8(1) who is or who claims to be entitled to a progress payment’ as a reference to a party to a construction contract who has undertaken to carry out construction work or supply related goods and services, and who therefore (under section 8(1) of the SOP Act) is entitled to a progress payment only on and from each reference date. The practical effect of the High Court’s decision is that an adjudicator will not have jurisdiction to determine a dispute in respect of any payment claim for which no reference date exists.

There will be a full review of this important decision in due course here in OnSite.