Martinus Rail Pty Ltd v Qube RE Services (No 2) Pty Ltd (No 2) [2024] NSWSC 1223

Martinus Rail Pty Ltd v Qube RE Services (No 2) Pty Ltd (No 2) [2024] NSWSC 1223

Jurisdictional error was established where the adjudicator failed materially to consider Qube’s submissions on (1) whether certain works constituted a variation, (2) quantum for delay costs, and (3) the bank guarantee restitution claim, thereby exceeding his statutory authority under the Act. These errors vitiated the corresponding portions of the determinations and judgments, necessitating their setting aside to that extent. Other alleged errors were within jurisdiction or not made out. Stay of judgment was refused as the evidence fell short of an inevitable or highly probable inability to repay.

Parties
Plaintiff/respondent: Martinus Rail Pty Limited; Defendant/applicant: Qube RE Services (No 2) Pty Limited; Second Defendant (in Proceedings 2024/286961): John Tuhtan
Jurisdiction
Australia
Judgment Date
30 September 2024
Procedural Posture
Judicial Review (with Joined Enforcement) Under Building and Construction Industry Security of Payment Act 1999 (nsw) / Post Adjudication: Review of Adjudicator's Determinations and Enforcement Judgments; Orders After Final Hearing
Outcome
Adjudication determinations and resulting judgments set aside in part due to jurisdictional error; refusal to grant a stay of enforcement; costs reserved; balance of challenges reserved for further determination.
Legal Topics
Security of Payment, Adjudication, Jurisdictional Error, Restitution, Contract Termination, Stay of Enforcement
Building and Construction Commercial Law Administrative Law Security of Payment Adjudication Jurisdictional Error Restitution Contract Termination +1 more

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Parties

Martinus Rail Pty Limited

Plaintiff/respondent

Qube RE Services (No 2) Pty Limited

Defendant/applicant

John Tuhtan

Second Defendant (in Proceedings 2024/286961)

Procedural Posture

Judicial Review (with Joined Enforcement) Under Building and Construction Industry Security of Payment Act 1999 (nsw) / Post Adjudication: Review of Adjudicator's Determinations and Enforcement Judgments; Orders After Final Hearing

Legal Issues

  1. 1 Whether the adjudicator made material jurisdictional error under Building and Construction Industry Security of Payment Act 1999 (NSW)
  2. 2 Scope of the adjudicator's obligation to consider submissions and give reasons
  3. 3 Whether claims allowed exceeded those properly before the adjudicator

Ratio Decidendi

Jurisdictional error was established where the adjudicator failed materially to consider Qube’s submissions on (1) whether certain works constituted a variation, (2) quantum for delay costs, and (3) the bank guarantee restitution claim, thereby exceeding his statutory authority under the Act. These errors vitiated the corresponding portions of the determinations and judgments, necessitating their setting aside to that extent. Other alleged errors were within jurisdiction or not made out. Stay of judgment was refused as the evidence fell short of an inevitable or highly probable inability to repay.

Court Disposition

Adjudication determinations and resulting judgments set aside in part due to jurisdictional error; refusal to grant a stay of enforcement; costs reserved; balance of challenges reserved for further determination.

Orders

  • Adjudication determination dated 22 July 2024 (ABCDRS NSW 586) set aside save for $22,703,118.54 including GST and interest; confirmed in that sum.
  • Adjudicator’s costs orders set aside; costs to fall in equal shares under s 29(2) of the Act.