IWD No 2 Pty Ltd v Level Orange Pty Ltd [2012] NSWSC 1439

IWD No 2 Pty Ltd v Level Orange Pty Ltd [2012] NSWSC 1439

The January 2011 conversation between representatives of IWD, Link and Level Orange created at least an arrangement between IWD and Level Orange under which Level Orange undertook to supply architectural services related to the project for IWD. Subsequent events did not supersede or alter that arrangement, and IWD's obligation was an independent obligation to ensure payment, not a secondary liability contingent on Link's default and not an indemnity. Accordingly, there was a construction contract to which the Act applied, and the Adjudicator did not fall into jurisdictional error.

Jurisdiction
Australia
Judgment Date
27 November 2012
Procedural Posture
Equity Division Commercial List Proceedings Challenging an Adjudication Determination Under the Building and Construction Industry Security of Payment Act 1999 / Principal Judgment
Outcome
Determination affirmed; IWD failed to establish jurisdictional error.
Legal Topics
['security of Payment Adjudication' 'jurisdictional Error' 'construction Contract' 'arrangement' 'guarantee' 'indemnity']
['building and Construction' 'equity' 'administrative Law'] ['security of Payment Adjudication' 'jurisdictional Error' 'construction Contract' 'arrangement' 'guarantee' 'indemnity']

Case Brief

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Procedural Posture

Equity Division Commercial List Proceedings Challenging an Adjudication Determination Under the Building and Construction Industry Security of Payment Act 1999 / Principal Judgment

Legal Issues

  1. 1 ['Whether there was a "construction contract" between IWD and Level Orange within the meaning of s 4 of the Building and Construction Industry Security of Payment Act 1999.' 'If there was a construction contract, whether it contained provisions by which IWD undertook to guarantee payment of money owing to Level Orange or to provide an indemnity to Level Orange within the meaning of s 7(3)(c), so that the Act did not apply.']

Ratio Decidendi

The January 2011 conversation between representatives of IWD, Link and Level Orange created at least an arrangement between IWD and Level Orange under which Level Orange undertook to supply architectural services related to the project for IWD. Subsequent events did not supersede or alter that arrangement, and IWD's obligation was an independent obligation to ensure payment, not a secondary liability contingent on Link's default and not an indemnity. Accordingly, there was a construction contract to which the Act applied, and the Adjudicator did not fall into jurisdictional error.

Court Disposition

Determination affirmed; IWD failed to establish jurisdictional error.

Orders

  • ['The parties were invited to bring in short minutes to give effect to the reasons.']