Adjudication in Western Australia: What is to be attached? Comparing the new security payment model to the old

In the decision of SLIC B&D Pty Ltd v David Trinder [2023] WASAT 1, the State Administrative Tribunal confirmed that an adjudication application under the Construction Contracts (Former Provisions) Act 2004 (WA) (Old Act) does not require the attachment of the construction contract.

This differs from the requirements under the new security of payment provisions in the Building and Construction Industry (Security of Payment) Act 2021 (WA) (New Act), which stipulate that attaching a copy of the construction contract or relevant contractual provisions is necessary to constitute a valid adjudication application.

Legislation

The Old Act was amended to cease its application to construction contracts entered into after 1 August 2023.  Construction contracts entered into after 1 August 2023 now fall within the ambit of the New Act.

Under the Old Act, an adjudication application must:

1. set out the details of, or have attached to it, the construction contract involved or relevant extracts of it;
2. include any payment claim that has given rise to the payment dispute; and
3. contain all the information that the claimant seeks to rely on.

Comparatively, under the New Act, an adjudication application must:

1. be made in writing and be in the approved form (if any);
2. identify the payment claim and the payment schedule (if any) to which it relates;
3. be accompanied by a copy of the construction contract or of the relevant provisions of the construction contract;
4. if made to an authorised nominating authority, must be accompanied by the application fee (if any) determined by the authority; and
5. must contain submissions relevant to the application that the claimant chooses to include.

Decision

SLIC B&D Pty Ltd (Builder) entered into a contract with Ms. Simpson (Owner) to carry out building works on a residential dwelling.  Following the Owner's refusal to pay the final payment claim in full, the Builder made an adjudication application under the Old Act.

The adjudication application was dismissed because the adjudicator found that the Builder failed to attach a copy of the contract or provide sufficient details of the contract. Subsequently, the Builder applied for a review of the adjudicator's decision.

Upon review, the Tribunal found that the tax invoice attached to the adjudication application outlined the terms of the parties' contract and a description of the works, thereby satisfying the requirements of an adjudication application under the Old Act.  As a result, the adjudication application was held valid, and the Tribunal subsequently set aside the adjudicator's decision.

Summary

The decision serves as a timely reminder to stakeholders within the Western Australian construction industry that there are differing strict requirements under the Old Act and the New Act.  It is imperative to be aware of these differing requirements and to seek advice when proceeding with an adjudication application under either the Old Act or the New Act.

Authors

Hendrik van Aswegen | Partner | +61 8 9404 9125 | hvanaswegen@tglaw.com.au

Samuel Speechly | Senior Associate | +61 7 3338 7529 | sspeechly@tglaw.com.au