CONTRACTS – BUILDING, ENGINEERING AND RELATED CONTRACTS –
REMUNERATION – STATUTORY REGULATION OF ENTITLEMENT TO
AND RECOVERY OF
PROGRESS PAYMENTS – ADJUDICATION OF PAYMENT CLAIMS – where the
Source
Original judgment source is linked above.
Catchwords
CONTRACTS – BUILDING, ENGINEERING AND RELATED CONTRACTS –REMUNERATION – STATUTORY REGULATION OF ENTITLEMENT TOAND RECOVERY OFPROGRESS PAYMENTS – ADJUDICATION OF PAYMENT CLAIMS – where theapplicant had purchased certain miningplant from a company which had affixed itto land the subject of a mining lease – where the mining lease did notgive riseto an interest in the land – where the applicant and the firstrespondent entered into a contract for the dismantling and removalof the miningplant – where the first respondent delivered a payment claim to theapplicant pursuant to the Building and Construction Industry Payments Act2004 (Qld) – where the Act only provided for payment claims referableto a ‘construction contract’ to carry out‘constructionwork’ within the meaning of s 10 of the Act – where the applicantcontended that the plant did not‘form part of land’ within themeaning of s 10 of the Act, and therefore the dismantling and removal was not
‘construction
work’ under the Act – whether the mining plant
‘form[ed] part of land’ within the meaning of s 10 of the
Act
Acts Interpretation Act 1954 (Qld) ss 4, 14A,
36
Building and Construction Industry Payments Act 2004 (Qld)
Matrix Projects (Qld) Pty Ltd v Luscombe [2013] QSC 4,
cited
Mills v Meeking [1990] HCA 6
(1990) 169 CLR 214, cited
Re Lehrer and
the Real Property Act (1961) SR (NSW) 365, considered
RJ Neller
Building Pty Ltd v Ainsworth [2008] QCA 397
[2009] 1 Qd R 390, considered
TEC Desert
Pty Ltd v Commissioner of State Revenue (Western Australia) [2010] HCA 49
(2010) 241 CLR
576, considered
Spankie & ors v James Trowse Constructions Pty Ltd
[2010] QCA 355, cited
T&M Buckley Pty Ltd v 57 Moss Rd Pty
Ltd [2010] QCA 381, cited
Thiess Pty Ltd v Warren Brothers Earthmoving
Pty Ltd [2012] QCA 276, considered
Wade v New South Wales Rutile
Mining Co Pty Ltd [1969] HCA 28
(1969) 121 CLR 177, cited
Western Australia v Ward
(2002) 213 CLR 1, cited
Wik Peoples v Queensland (1996) 187 CLR 1,
cited
Judgment (213 paragraphs)
[1]
The applicant's submissions on the first jurisdictional issue
[2]
[19] Counsel for the applicant submitted that where buildings or structures are regarded under the general law as forming part of land, they will have the same character for the purposes of BCIPA. On the other hand, where they are characterised under the general law as comprising personal property, they do not form part of land for the purposes of BCIPA.
[3]
(a) The existence of a construction contract between the claimant (the first respondent before this Court) and the respondent (the applicant before this Court) to which the Act applies is a basic and essential requirement for a valid adjudicator's determination.
[4]
(b) The Courts have not yet considered the test to be applied under BCIPA to determine when chattels are to be regarded as "forming part of land".
[5]
(c) The Courts have developed a relatively clear test for determining whether or not chattels form part of land at common law. Whether an item becomes a fixture depends essentially upon the objective intention with which it is put in place. The degree of annexation and the object of annexation are commonly regarded as relevant to determining the intention.
[6]
(d) When the Legislature employs a concept which has an established and relatively certain legal meaning, it is not to be assumed that this meaning was intended; however, depending upon the context, this is commonly the correct inference to be drawn as a matter of construction. In deciding whether this meaning was intended by the Legislature, a close examination of the statutory context and purpose is required.
[7]
(e) There are five main features of BCIPA to be noted.
[8]
(i) BCIPA does not contain any special definition of the expression "forming part of land"; this suggests that the established legal doctrines concerning this concept were intended to be adopted;
[9]
(ii) The Act gives numerous examples of items which may "form part of land": s 10(1)(b) and (c). They are typical of items which would generally be characterised at common law as forming part of land (eg walls, roadworks, powerlines, power supply, drainage, sanitation, etc). They include some items which are attached directly to land (eg roadworks) and some which are attached via other structures (eg airconditioning systems). The reference to the latter is a strong indication of an intention to adopt the common law concept of what forms part of land, as it is not an ordinary usage of language to describe light fittings, airconditioning ducts, etc as "forming part of land".
[10]
(iii) As permanence is not a requirement of the common law, the inclusion of the expression "whether permanent or not" in s 10(1)(a) suggests that the Legislature intended the common law concept of "forming part of land" rather than some other concept.
[11]
(iv) The apparent purpose of the expression is to allow a relatively clear line to be drawn between work which is intended to be regulated by BCIPA and work which is not. The Legislature appears to have drawn upon the existing law to provide a relatively clear and established test to draw the line in a spectrum of activity where lines are not easily drawn.
[12]
(v) If the expression "forming part of land" is not to be understood as incorporating existing common law doctrines, it will suffer from a serious lack of conceptual certainty.
[13]
[21] They submitted that it is relevant to the objective intent with which the objects were placed on the land that by s 10 of the Mineral Resources Act 1989 (Qld), the grant of the mining leases did not create an estate or interest in land. Further, by s 276(1)(c) of that Act, it was a condition of every mining lease that, prior to termination of the lease, the holder remove any building, structure, equipment or plant from the lease area.
[14]
[22] They developed this submission in this way. ACC had no proprietary interest in the land. It occupied the land pursuant to a statutory right to use it for the purpose of removing minerals. It owned the mining plant and brought it on to the leases only for the purposes of mining activities. Applying the objective test under the general law, the mining plant was never intended to form part of the land and so never did so. As with ACC's rights under the mining lease itself, the mining plant remained the property of the mining lease holder and subject to removal at the end of the lease. Accordingly, the mining plant is not properly characterised as "forming part of land" for the purpose of s 10 of BCIPA.
[15]
The first respondent's submissions on the first jurisdictional issue
[16]
[23] Counsel for the first respondent submitted that the relevant question in the present proceeding is whether or not the buildings or structures formed part of the land in the physical sense.
[17]
(a) The task of statutory construction must begin with consideration of the text itself. The meaning of the text may require consideration of the context, which includes the general purpose and policy of the provision.
[18]
(b) Section 10(1) should be construed broadly. There is no reason to read a restriction into the section that does not appear in the text of the section or otherwise in the Act.
[19]
(c) The text of ss 10(1)(a) and 10(1)(b) leads to a "natural construction" that directs enquiry as to whether or not buildings or structures are somehow annexed/connected to the land so as to form part of the land. It is not directed to the entirely different question about ownership of the buildings or structures. It is a question of fact and degree.
[20]
(d) Section 10(3) expressly excludes certain mining activities from being "construction work" for the purposes of BCIPA. Buildings and structures built for the occupier of a mining lease (as opposed to the registered owner of the land) are not excluded by s 10(3). If the applicant's construction were correct, there would be no need for s 10(3), because none of the things identified in s 10(3) are fixtures. There is nothing in the purpose of s 10(3) that requires a broad meaning to be given to it.
[21]
(e) Section 10(1)(a) expressly states that the buildings or structures do not need to be permanent. If the question were simply one directed to who owned the building or structure, then whether or not they were permanent would be an irrelevant consideration and the words "whether permanent or not" would have no work to do.
[22]
(f) There is nothing in the context or purpose of BCIPA that supports a construction that restricts the operation of the Act to buildings or structures that are fixtures in the sense of being a thing owned by the registered owner of the land.
[23]
(g) Section 3 sets out categories of contracts that may otherwise be considered to be "construction contracts" that are specifically excluded from the operation of BCIPA. That list does not include reference to buildings or structures on mining leases built etc for the occupier of a mining lease (not the registered owner of the land).
[24]
(h) The term "fixture" is not used anywhere in BCIPA.
[25]
(i) If the land were freehold and not leasehold, on the applicant's construction of s 10, BCIPA would apply. Nothing in the text, context or purpose of BCIPA calls for a distinction to be made between freehold and leasehold land, or an enquiry as to who owns the building or structure that is the subject matter of the particular contract.
[26]
(j) Whether the buildings or structures are to be treated as chattels or fixtures for the purposes of the Stamp Act 1921 (WA) or the Mineral Resources Act 1989 (Qld) is irrelevant to the proper construction of BCIPA.
[27]
[25] By s 14A of the Acts Interpretation Act 1954 (Qld), the interpretation that will best achieve the purpose of the Act is to be preferred to any other interpretation. As Dawson J said of the cognate provision in the Interpretation of Legislation Act 1984 (Vic) in Mills v Meeking,[1] the purposes of an act are to be taken into account in construing its provisions
[28]
"not only where those provisions on their face offer more than one construction, but also in determining whether more than one construction is open."
[29]
Close attention must still be paid to the actual words of a provision. His Honour continued -
[30]
"Reference to the purposes may reveal that the draftsman has inadvertently overlooked something which he would have dealt with had his attention been drawn to it and if it is possible as a matter of construction to repair the defect, then this must be done. However, if the literal meaning of a provision is to be modified by reference to the purposes of the Act, the modification must be precisely identifiable as that which is necessary to effectuate those purposes and it must be consistent with the wording otherwise adopted by the draftsman. [The section] requires a court to construe an Act, not to rewrite it, in the light of its purposes."
[31]
[26] The purpose of an act is to be gleaned from the act as a whole. Like many contemporary statutes, BCIPA contains an objects clause (s 7), to which I shall turn in a moment. The objects clause itself must be interpreted in its context, as a general statement of principle may be qualified by a specific provision.[2]
[32]
[27] As Brennan CJ, Dawson, Toohey and Gummow JJ observed in CIC Insurance Ltd v Bankstown Football Club Ltd -[3]
[33]
"... the modern approach to statutory interpretation (a) insists that the context be considered in the first instance, not merely at some later stage when ambiguity might be thought to arise, and (b) uses 'context' in its widest sense to include such things as the existing state of the law and the mischief which, by legitimate means such as those just mentioned, one may discern the statute was intended to remedy. Instances of general words in a statute being so constrained by their context are numerous. In particular, as McHugh JA pointed out in Isherwood v Butler Pollnow Pty Ltd,[4] if the apparently plain words of a provision are read in the light of the mischief which the statute was designed to overcome and of the objects of the legislation, they may wear a very different appearance. Further, inconvenience or improbability of result may assist the court in preferring to the literal meaning an alternative construction which, by the steps identified above, is reasonably open and more closely conforms to the legislative intent."
[34]
"An Act to imply terms in construction contracts, to provide for adjudication of payment disputes under construction contracts, and for other purposes." (Emphasis added)
[35]
The object of this Act is to ensure that a person is entitled to receive, and is able to recover, progress payments if the person -
[36]
(a) undertakes to carry out construction work under a construction contract; or
(b) undertakes to supply related goods and services under a construction contract." (Emphasis added)
[37]
(a) granting an entitlement to progress payments whether or not the relevant contract makes provision for progress payments; and
(b) establishing a procedure that involves -
[38]
(i) the making of a payment claim by the person claiming payment; and
(ii) the provision of a payment schedule by the person by whom the payment is payable; and
(iii) the referral of a disputed claim, or a claim that is not paid, to an adjudicator for decision; and
(iv) the payment of the progress payment decided by the adjudicator."
[39]
[30] Entitlement to serve a progress claim depends on entitlement to a progress payment, which in turn depends on construction work under a construction contract having been undertaken (or related goods and services having been supplied under the construction contract).[5]
[40]
From each reference date under a construction contract, a person is entitled to a progress payment if the person has undertaken to carry out construction work, or supply related goods and services, under the contract." (Emphasis added)
[41]
"Reference date" is defined in Schedule 2 as follows -
[42]
"****Reference date, under a construction contract, means -
[43]
(a) a date stated in, or worked out under, the contract as the date on which a claim for a progress payment may be made for construction work carried out or undertaken to be carried out, or related goods and services supplied or undertaken to be supplied, under the contract; or
(b) if the contract does not provide for the matter -
[44]
(i) the last day of the named month in which the construction work was first carried out, or the related goods and services were first supplied, under the contract; and
(ii) the last day of each later named month."
[45]
[32] Recovery of progress payments is provided for in Part 3 of the Act.[6] By s 17(1) -
[46]
(1) A person mentioned in section 12 who is or who claims to be entitled to a progress payment (the claimant) may serve a payment claim on the person who, under the construction contract concerned, is or may be liable to make the payment (the respondent)." (Emphasis added)
[47]
[33] A "respondent" served with a payment claim may reply to the claim by serving a "payment schedule" stating its reasons for wholly or partially withholding payment.[7] The claimant may then apply for adjudication of its payment claim by an "adjudication application".[8] The respondent may reply by an "adjudication response".[9] The issues for determination by the adjudicator are defined in the payment claim and the payment schedule, while the parties may make submissions in support of their respective positions in the adjudication application and the adjudication response respectively. The adjudicator must decide -
[48]
"(a) the amount of the progress payment, if any, to be paid by the respondent to the claimant (the adjudicated amount); and
(b) the date on which any amount became or becomes payable; and
(c) the rate of interest payable on any amount."[10]
[49]
An adjudication certificate may be filed as a judgment for a debt and enforced in a court of competent jurisdiction pursuant to s 31. However, an adjudication does not finally determine the rights of the parties. Under s 100, a party may "claw back" progress payments it is forced to make through the adjudication process in subsequent civil proceedings.[11]
[50]
[34] In RJ Neller Building Pty Ltd v Ainsworth[12] Keane JA (with whom the other members of the Court agreed) said -
[51]
"[39] It is evidently the intention of the BCIP Act, and, in particular, s 31 and s 100 to which reference has been made, that the process of adjudication established under that Act should provide a speedy and effective means of ensuring cash flow to builders from the parties with whom they contract, where those parties operate in a commercial, as opposed to a domestic, context. This intention reflects an appreciation on the part of the legislature that an assured cash flow is essential to the commercial survival of builders, and that if a payment the subject of an adjudication is withheld pending the final resolution of the builder's entitlement to the payment, the builder may be ruined.
[52]
[40] The BCIP Act proceeds on the assumption that the interruption of a builder's cash flow may cause the financial failure of the builder before the rights and wrongs of claim and counterclaim between builder and owner can be finally determined by the courts. On that assumption, the BCIP Act seeks to preserve the cash flow to a builder notwithstanding the risk that the builder might ultimately be required to refund the cash in circumstances where the builder's financial failure, and inability to repay, could be expected to eventuate. Accordingly, the risk that a builder might not be able to refund moneys ultimately found to be due to a non-residential owner after a successful action by the owner must, I think, be regarded as a risk which, as a matter of policy in the commercial context in which the BCIP Act applies, the legislature has, prima facie at least, assigned to the owner."
[53]
[35] And in Thiess Pty Ltd v Warren Brothers Earthmoving Pty Ltd[13] Philippides J (with whom Holmes and White JJA agreed) described the purpose of BCIPA as being -
[54]
"to provide a speedy interim solution to progress payment disputes arising under construction contracts."
[55]
[36] The definitions of "construction contract" in Schedule 2 and "construction work' in s 10 set the limits of the class of persons who are entitled to make payment claims and correspondingly the class of persons who are subject to the restrictions and obligations imposed by the act.[14]
[56]
[37] Where legislation is remedial in character, a provision capable of more than one interpretation or whose meaning is uncertain should be construed beneficially, in favour of those intended to benefit,[15] subject to the rider that the interpretation adopted must
[57]
"...be restrained within the confines of 'the actual language employed' and what is 'fairly open' on the words used."[16]
[58]
[38] In Edelbrand Pty Ltd v HM Australia Holdings Pty Ltd[17] Bathurst CJ (with whom McColl and Tobias JJA agreed) described the New South Wales legislation corresponding with BCIPA as "remedial legislation". His Honour said that the definition of "related goods and services" in s 6 of the NSW Act[18] should be given a liberal interpretation, subject to that rider. His Honour quoted this passage from the judgment of Brennan CJ and McHugh J in IW v The City of Perth -
[59]
"... beneficial and remedial legislation, like the [Equal Opportunity Act1984 (WA)], is to be given a liberal construction. It is to be given 'a fair, large and liberal' interpretation rather than one which is 'literal or technical'. Nevertheless, the task remains one of statutory construction. Although a provision of the Act must be given a liberal and beneficial construction, a court or tribunal is not at liberty to give it a construction that is unreasonable or unnatural."
[60]
[39] In Queensland differing views have been expressed upon whether BCIPA is truly remedial in character.
[61]
[40] For example, in Thiess Pty Ltd v Warren Brothers Earthmoving Pty Ltd the Court of Appeal considered the exception to the definition of "construction work" in s 10(3). Philippides J (with whom the other members of the Court agreed) said it was difficult to see how "the beneficial purpose" of the act would be promoted by a wide interpretation of that provision.[19]
[62]
[41] In Capricorn Quarries Pty Ltd v Inline Communication Construction Pty Ltd & ors,[20] Jackson J described the act as reallocating rights and commercial risks, and doubted whether legislation having that effect is truly remedial in character. His Honour said -
[63]
"[45] Having regard to the context as discussed, in my view, a 'natural' construction of the relevant definitions of BCIPA in this case is to be preferred to an approach which seeks to extend the operation of BCIPA by a 'liberal interpretation' to be engaged in with the purpose of increasing the width of the class of persons who are entitled to the benefit of a payment claim and correspondingly increasing the width of the class of persons who are subject to BCIPA's restriction and obligations.
[46] The language chosen by Parliament to define 'construction contract', 'construction work' and 'related goods and services' has no purpose other than to draw the line between who is in and who is out of those classes. There seems to be little logic in seeking to stretch that language either way. In saying this, I take a 'natural' construction to be that arrived at by the usual process of the application of the common law of statutory interpretation, as affected by statute, but without a presumptive approach."[21]
[64]
[42] As I shall explain, I consider that the meaning of s 10 is clear, and accordingly it is not necessary for me to consider whether the legislation is remedial in character.
[65]
[43] There is no definition of "land" or "forming part of land" in BCIPA.
[66]
[44] According to the Oxford English Dictionary[22] two of the meanings of the transitive verb "to form" are -
[67]
"...6a. To be the component or material of; to go to make up, to compose." and
[68]
"...6b. To serve for, constitute, to make one or part of."
[69]
[45] The primary meaning of "land" in the Oxford English Dictionary[23] is -
[70]
"The solid portion of the earth's surface, as opposed to sea, water."
[46] Various words and expressions commonly found in statutes are defined in s 36 of the Acts Interpretation Act 1954 (Qld). Those definitions may be displaced, wholly or in part, by a contrary intention appearing in a statute.[24]
[73]
"messuages, tenements and hereditaments, corporeal or incorporeal, of any tenure or description, and whatever may be the interest in the land."
[74]
This is not an exhaustive definition. An "interest" in land is widely defined -
[75]
"interest, in relation to land or other property, means -
[76]
(a) a legal or equitable estate in the land or other property;
[77]
(b) a right, power or privilege over, or in relation to, the land or other property."
[78]
[48] In Re Lehrer and the Real Property Act[25] Jacobs J had to determine whether the lease of part of a building, as distinct from the soil on which the building stood, effected a subdivision within the meaning of the Local Government Act 1919 (NSW). To do so, he had to consider whether part of the building or the airspace taken up by that part of the building was "land" within the definition of "subdivision" in the Local Government Act.
[79]
[49] His Honour considered the definition of "land" in s 21(e) of the Interpretation Act 1897 (NSW), which was relevantly in the same terms as s 36 of the Acts Interpretation Act (Qld). As he explained -
[80]
(a) a "messuage" is a house, including its curtilage;
(b) the strict meaning of "tenement" is "everything in which a man can have an estate of freehold and which is connected with land"; and
(c) "hereditament" denotes such things as might formerly be the subject matter of inheritance.
[81]
"With these meanings in mind it will be observed how wide is the definition of land in the Interpretation Act of 1897. The word includes freehold and leasehold, corporeal and incorporeal interests of every description. The estate in fee simple at law or in equity, the other estates of freehold, whether in possession or remainder, the leasehold, whatever be the term, all are included. Undoubtedly the lease or conveyance of an upper chamber would come within the definition. But there would also come within the definition every interest which in law is, or savours of, realty. Probably the easement, and certainly the profit à prendre and the rent charge, are 'land' within the definition is s 21(e)."
[82]
His Honour concluded that the definition of "land" in the Interpretation Act was wide enough to include the air space above the soil and the upper floor of a building as a tenement or corporeal hereditament. However, that definition had been displaced by the Local Government Act 1919 (NSW).
[83]
[50] There is nothing in BCIPA to displace the definition of land in the Acts Interpretation Act.
[84]
[51] The meaning of "land" at common law is far more expansive than its primary meaning in ordinary usage.
[85]
[52] The common law distinguishes between real property and personal property. There is a distinction between land and real property. Something may be real property without being land - for example, a tenement or hereditament. The definition in the Acts Interpretation Act goes beyond the common law in that it provides that a tenement or hereditament is land.
[86]
[53] At common law, "land" includes everything above and below its surface.
[87]
[54] Prima facie, land includes any structure erected on it and objects permanently attached to the structure. However, it is not appropriate to describe either the structure itself or any part of it as land.[26]
[88]
[55] Something may be attached to land in such a way that it becomes part of the land - that is, a fixture. Whether a chattel has become a fixture depends essentially upon the objective intention with which it was put in place. In what has been described as an "inherently undefinable area",[27] the courts look at all the circumstances, including the purpose of annexation and the degree of annexation.[28] How long it was contemplated that the item would be on the land - whether permanently or for an indefinite or substantial period as opposed to temporarily - is relevant to the assessment of the objective intention with which it was placed on the land.[29] Depending on all the circumstances, items such as plumbing and air conditioning ducts may be fixtures, even though they are affixed to the land indirectly through other structures rather than directly.
[89]
[56] On the sale of land, fixtures pass to the purchaser as part of the realty. Similarly, if the owner dies, fixtures pass to those entitled to the deceased's real property rather than to those entitled to his or her personal property. In Epic Energy (Pilbara Pipeline) Pty Ltd v Commissioner of State Revenue[30] Buss JA summarised this aspect of the common law -
[90]
"[161] At common law, where a physical object or thing is attached or fixed to land in the physical sense, the physical object or thing becomes part of the land and is 'subjected to the same rights of property as the land itself'.[31]
[162] Accordingly, at common law, whether and to what extent an estate or interest in land may confer an estate or interest in a physical object or thing that is attached or fixed to the land in the physical sense, depends upon the nature and extent of the particular estate or interest in the physical land itself.
[163] The common law may, of course, be modified or abrogated by statute."
[91]
[57] In Attorney-General for NSW v Brewery Employees Union of NSW O'Connor J observed -[32]
[92]
"Where words have been used which have acquired a legal meaning it will be taken, prima facie, that the legislature has intended to use them with that meaning unless a contrary intention clearly appears from the context. To use the words of Denman J in R v Slator:[33] 'but it always requires the strong compulsion of other words in an Act to induce the Court to alter the meaning of a well known legal term'."
[93]
[58] A shift of emphasis is discernible in what the High Court said in TEC Desert Pty Ltd v Commissioner of State Revenue (Western Australia) -[34]
[94]
"... of terms such as 'real property', 'lease' and 'fixture' it should be emphasised that, not only does each bear a technical meaning in the general law, but also when they appear in statutory regimes creating rights and imposing obligations it is not to be assumed that they are used simply and exclusively in the sense understood by the general law."
[95]
[59] As counsel for the applicant submitted, where the Legislature has used a word or expression with an established and relatively certain legal meaning, it is not be assumed that it intended that meaning - but, depending on the context, that may be the correct inference to be drawn as a matter of construction.
[96]
[60] The minerals to be extracted vested in the Crown, and not in the owner of the land.[35]
[97]
[61] A mining lease should not be confused with a lease of the land the subject of the mining lease. It is necessary to examine the legislation under which a mining lease is granted to ascertain the rights and obligations of the leaseholder.[36]
(1) The Minister may grant to an eligible person or persons, a mining lease for all or any of the following purposes -
[100]
(a) to mine the mineral or minerals specified in the lease and for all purposes necessary to effectually carry on that mining;
(b) such purposes, other than mining, as are specified in the mining lease and that are associated with, arising from or promoting the activity of mining."
(1) Mine means to carry on an operation with a view to, or for the purpose of -
[103]
(a) winning mineral from a place where it occurs; or
(b) extracting mineral from its natural state; or
(c) disposing of mineral in connection with, or waste substances resulting from, the winning or extraction.
[104]
(2) For subsection (1), extracting includes the physical, chemical, electrical, magnetic or other way of separation of a mineral.
(3) Extracting includes, for example, crushing, grinding, concentrating, screening, washing, jigging, tabling, electrowinning, solvent extraction electrowinning (SX-EW), heap leaching, flotation, fluidised bedding, carbon-in-leach (CIL) and carbon-in-pulp (CIP) processing.
(4) However, extracting does not include -
[105]
(a) a process in a smelter, refinery or anywhere else by which mineral is changed to another substance; or
(b) testing or assaying small quantities of mineral in teaching institutions or laboratories, other than laboratories situated in the area of a mining lease; or
(c) an activity, prescribed under a regulation, that is not directly associated with winning mineral from a place where it occurs.
[106]
(5) For subsection (1), disposing includes, for example, the disposal of tailings and waste rock.
(6) A regulation under subsection (4)(c) may prescribe an activity by reference to the quantities of minerals extracted or to any other specified circumstances."
The grant of a mining tenement under this Act does not create an estate or interest in land."
[109]
(c) a condition that the holder, prior to the termination of the mining lease for whatever cause, shall remove any building or structure purported to be erected under the authority of the mining lease and all mining equipment and plant, on or in the area of the mining lease unless otherwise approved by the Minister; ..."
[110]
[66] Thus, the mining leases entitled the leaseholder to remove minerals and to carry out associated mining activities on the land the subject of the leases.
[111]
They did not give rise to any estate or interest in that land. The leaseholder was required to remove the mining plant from the land prior to the expiry of the leases.
[112]
[67] This statutory scheme is consistent with the treatment of mining tenements by the common law and statutes in other jurisdictions, which was discussed by the High Court in Wade v New South Wales Rutile Mining Co Pty Ltd;[37] Western Australia v Ward[38] and TEC Desert Pty Ltd v Commissioner of State Revenue (Western Australia).[39]
[113]
[68] In TEC Desert the High Court considered the meaning of "land" in the Stamp Act 1921 (WA). "Land" was defined as including an estate or interest in land, and "chattel" was defined as including an estate or interest therein. "Transfer" included convey and vest. Under the act, duty was not payable on the transfer of chattels, but an instrument providing for the concurrent transfer of land and chattels was dutiable on the combined value of the land and the chattels.
[114]
• WMC Resources Ltd had power generation assets, including power stations, on land subject to mining tenements which it held. The mining tenements did not give rise to an estate or interest in land. Further, the tenant (WMC) was under a statutory obligation to remove affixed items upon the expiry of the mining tenement.
[115]
• It had other power generation assets, including the Kalgoorlie power station, which were on freehold land it owned.
[116]
• It entered into an agreement to sell certain power generation assets, which included power stations, generators, electrical wires, and transmission and distribution equipment, to TEC Desert Pty Ltd and another company.
[117]
• The agreement provided for the sale of those assets that were chattels or personal property, but not those that were "Fixtures".
[118]
• "Fixtures" were defined in the agreement as items "affixed to land, and an estate or interest in which is therefore an estate or interest in land".
[119]
• Any interest WMC had in the "Fixtures" was expressly excepted from the sale assets. The licences were to be made the subject of licences in favour of the purchasers to allow them to use the "Fixtures" and the areas of land on which they were located. The licence fees were to be prepaid on completion of the sale agreement, and if the licences were terminated, the purchasers were required to acquire the "Fixtures" from WMC.
[120]
• WMC warranted that it had title to the "Fixtures" "as the owner thereof notwithstanding the affixation" to the freehold.
[121]
[70] The Commissioner of State Revenue assessed duty on the basis that the sale assets were mostly "fixtures in the technical sense of that term", and so the agreement was for the transfer of interests in both land and chattels. The High Court held unanimously that the agreement was not for the transfer of any interest in land, and so was not subject to stamp duty.
[122]
[71] The High Court held that items brought on to land pursuant to the mining tenements had not become "fixtures" according to the common law - because the tenements were themselves not realty but personalty, and, further, because the holder of the tenements was under a statutory obligation to remove them upon the expiry of the tenements. [40] In relation to the assets on the freehold, the Court held that there was no transfer of an estate or interest in land because only chattels or personal property were agreed to be transferred, and assets that were "Fixtures" were subject to the licence agreements. The parties had contracted on the agreed assumption that WMC had title to the "Fixtures" as chattels, separate and distinct from its title to the land, which provided consideration for payments the purchasers were obliged to make under the licence agreements.[41]
[123]
[72] In my respectful opinion, the High Court's analysis should be applied to the mining leases issued under the Mineral Resources Act 1989 (Qld). The minerals vested in the Crown, rather than in the owner of the land the subject of the mining leases. The leaseholder was entitled to remove the minerals, but did not acquire any estate or interest in the land the subject of the mining leases. Thus, the mining leases were not "land" within the definition in the Acts Interpretation Act 1954 (Qld) or in accordance with common law principles.
[124]
[73] The mining plant was brought on to that land for the purposes of the mining leases. In so far as it was physically attached to the land, I infer that this was to stabilise it and allow its efficient operation, rather than to add some additional feature to the land on which it rested. It had to be removed before the expiry of the mining leases. In the circumstances the common law requirements for the mining plant to become part of the land the subject of the mining leases (that is, fixtures) were not satisfied.
[74] The question which must be determined is whether the various items of mining plant, while in situ, formed part of land within the meaning of s 10 of BCIPA. While the question is not whether they were fixtures in the technical sense, the common law doctrine of fixtures informs the consideration of the ultimate question.
[127]
[75] Section 10 sets the limits of those who may take advantage of, and those who are subject to, the statutory scheme for speedy interim resolution of progress payment disputes.
[128]
[76] By paragraphs (a), (b) and (c) of s 10, "buildings or structures", "works" and "fittings" may all "form part of land". There is nothing in the language of s 10 or of BCIPA as a whole to displace the definition of "land" in the Acts Interpretation Act 1954 (Qld). Nor is there anything in the language of s 10 or of BCIPA as a whole to suggest that buildings or structures, works or fittings may "form part of land" under that Act when they would not do so at common law.[42]
[129]
[77] As I have said, the mining leases merely entitled the leaseholder to remove minerals (which vested in the Crown, not the landholder) and to carry out associated mining activities; they did not give rise to an estate or interest in the land over which they were granted. They were not "land" under the common law or pursuant to the Acts Interpretation Act. I consider that they were not "land" within the meaning of BCIPA.
[130]
[78] The mining plant was brought on to the land over which the mining leases were granted for the purposes of the mining leases, and had to be removed before their expiry. Most if not all of it was in some way affixed to the land, but in my view that affixation was to stabilise the plant and allow its efficient operation rather than to add some additional feature to the land on which it rested.
[131]
[79] Thus, the mining plant may have formed part of the mining leases, but it did not form part of the land the subject of those mining leases. It did not form part of "land" within the meaning of BCIPA.
[132]
[80] In saying this, I have not overlooked that by paragraph (a) of s 10(1) a structure can form part of land without being permanent. At common law one of the factors relevant to whether something is a fixture is whether it was placed on the land permanently or for an indefinite or substantial period rather than temporarily.[43] As counsel for the applicant submitted, the common law does not require permanence. The use of the expression "whether permanent or not" in s 10(1)(a) is an indicator of consistency between the concept of forming part of land under s 10 and the concept of forming part of land under the common law.
[133]
[81] Paragraphs (b) and (c) of s 10(1) give numerous examples of items which may form part of land, some of which are attached directly to land (for example, roadworks) and some of which are attached via other structures (for example, airconditioning). As counsel for the applicant submitted, it is not an ordinary use of language to describe air conditioning ducts as "forming part of land", but it is an indicator of consistency between the concept of forming part of land under s 10 and the concept of forming part of land under the common law.
[134]
[82] Section 10(3) excludes from the concept of "construction work" -
[135]
"(a) the drilling for, or extraction of, oil or natural gas;
(b) the extraction, whether by underground or surface working, of minerals, including tunnelling or boring, or constructing underground works for that purpose".
[136]
But for this exclusion, those activities would arguably fall within paragraph (b) of s 10(1). I agree with counsel for the applicant's submission that s 10(3) does not purport to deal in any way with objects of the kind presently under consideration or to imply anything about the test to be applied under s 10(1)(a)-(b).
[137]
[83] By s 3(2), (3) and (4), certain categories of contracts are expressly excluded from the operation of the Act -
[138]
(a) a construction contract to the extent that it forms part of a loan agreement, a contract of guarantee or a contract of insurance under which a recognised financial institution undertakes -
[139]
(i) to lend an amount or to repay an amount lent; or
(ii) to guarantee payment of an amount owing or repayment of an amount lent; or
(iii) to provide an indemnity relating to construction work carried out, or related goods and services supplied, under the construction contract; or
[140]
(b) a construction contract for the carrying out of domestic building work if a resident owner is a party to the contract, to the extent the contract relates to a building or part of a building where the resident owner resides or intends to reside; or
(c) a construction contract under which it is agreed that the consideration payable for construction work carried out under the contract, or for related goods and services supplied under the contract, is to be calculated other than by reference to the value of the work carried out or the value of the goods and services supplied.
[141]
(3) This Act does not apply to a construction contract to the extent it contains -
[142]
(a) provisions under which a party undertakes to carry out construction work, or supply related goods and services in relation to construction work, as an employee of the party for whom the work is to be carried out or the related goods and services are to be supplied; or
(b) provisions under which a party undertakes to carry out construction work, or to supply related goods and services in relation to construction work, as a condition of a loan agreement with a recognised financial institution; or
(c) provisions under which a party undertakes -
[143]
(i) to lend an amount or to repay an amount lent; or
(ii) to guarantee payment of an amount owing or repayment of an amount lent; or
(iii) to provide an indemnity relating to construction work carried out, or related goods and services supplied, under the construction contract.
[144]
(4) This Act does not apply to a construction contract to the extent it deals with construction work carried out outside Queensland or related goods and services supplied for construction work carried out outside Queensland."
[145]
I do not think any useful inference can be drawn from the mere fact that there is no express exclusion of contracts for the construction, etc of buildings or structures on a mining lease for the benefit of the holder of the lease.
[146]
(a) "land" in s 10 of BCIPA does not include mining leases;
[147]
(b) the plant may have formed part of the mining leases;
[148]
(c) the plant did not "form part of land" within the meaning of s 10.
[149]
[85] It follows that the dismantling of the plant was not "construction work" under a "construction contract". The adjudication decision was void for want of jurisdiction.
[150]
[86] Senior counsel for the applicant acknowledged that if the first jurisdictional question were determined in his client's favour it would not be necessary to answer the second. Nevertheless, I think it is appropriate that I express my views on it so far as I am able.
[151]
[87] Counsel for the applicant submitted that a payment claim which relates to construction work done (or related goods and services supplied) under more than one construction contract is not a valid "payment claim" within the meaning of ss 12 and 17 of BCIPA. It follows, in their submission, that an adjudication application on a payment claim relating to more than one construction contract is invalid, and an adjudicator has no jurisdiction to adjudicate upon such a payment claim.
[152]
[88] Counsel for the first respondent submitted that on the facts their client had made a claim in respect of only one contract, but had erroneously included amounts which were referable to another contract.
[153]
(a) The payment claim included charges totalling $195,454.74 for "Charters Towers equipment hire", which the third respondent (the adjudicator) disallowed in its entirety. She noted that the present applicant had, in its payment schedule, referred to those charges as being for separate works, but that it had not addressed the issue in its adjudication response. She was not satisfied that the present first respondent was entitled to the amount claimed, and was unable to ascertain what, if any, amount was payable.
[154]
(b) The amount allowed by the third respondent included $9,957.24, which, at least for the purposes of this application, the first respondent conceded was not referable to the primary contract. What that amount was for, and whether it was within the $195,454.74, was not made clear in submissions.
[155]
[89] The payment claim was submitted as an attachment to an email from Iona Bird of the first respondent to Jonathan Robbeson of the applicant. It comprised a document on the first respondent's letterhead headed "Tax Invoice", to which a document headed "Schedule A" was attached. It was accompanied by five invoices with supporting documentation.
[156]
[90] The body of the Tax Invoice was as follows -
[157]
For the provision of labour, materials, plant, equipment and related goods and services necessary for the dismantling of mine buildings, structures and associated equipment at Skardon River, Queensland and the delivery to and unloading of same at Charters Towers as per:
[158]
3. the tax invoices referred to in the said Schedule together with the supporting documentation attached to the said tax invoices,
[159]
Please detach the portion below and forward with your payment
[160]
This is a payment claim made under the Building and Construction Industry Payments Act 2004 (Qld)."
[161]
[91] The document dated 8 June 2012 was in fact a quotation for carrying out "the works described in [the applicant's] tender documents". A schedule of rates and a schedule of estimated quantities were attached. However, neither the tender documents nor any other description of the works was attached. A purported acceptance of the quotation, not by the applicant but by another company Greenvale Silicon Pty Ltd, was endorsed on the last page.
[162]
[92] Logically, it is not possible to construe the payment claim to determine whether it purported to relate to more than one contract without first identifying the contract and what it comprised. As I have related, there is dispute between the applicant and the first respondent as to the terms, nature and extent of the primary contract, but I have not been asked to resolve that dispute for the purposes of this application. In these circumstances, the second jurisdictional question is hypothetical.
[163]
[93] A payment claim must identify the construction work (or related goods and services) in respect of which it is made. In T&M Buckley Pty Ltd v 57 Moss Rd Pty Ltd[44] the Court of Appeal considered the degree of specificity required for a valid payment claim. Philippides J (with whom the other members of the Court agreed) reviewed relevant New South Wales authorities and concluded that all that is required is that the payment claim reasonably identify the construction work to which it relates such that the basis of the claim is reasonably comprehensible to the respondent to the claim.[45]
[164]
[94] Whether a payment claim concerns a "construction contract" is a jurisdictional fact.[46] A contract or arrangement is a "construction contract" if it requires a party to undertake some "construction work" notwithstanding that it contains other undertakings or imposes other obligations not within the definition of "construction work".[47] Where there is no error in an adjudicator's determination that a contract is a "construction contract", an error in determining the extent and quantum of the work that comprised "construction work" is an error of fact and not a jurisdictional error.[48]
[165]
[95] Out of deference to counsel's submissions, I express the following tentative views, without purporting to decide the second jurisdictional question.
[166]
[96] I am inclined to think that where a "construction contract" requires a party to perform some "construction work" but also contains other undertakings or imposes obligations not within the definition of "construction work", a "payment claim" is not invalid because it includes a claim for something that is required by the contract but which is not "construction work".
[167]
[97] In Matrix Projects (Qld) Pty Ltd v Luscombe[49] Douglas J considered that a "payment claim" must relate to only one "construction contract". His Honour concluded that the payment claim in question related to more than one construction contract, and so could not be the foundation for a valid adjudication. How his Honour came to the conclusion that the payment claim related to more than one contract is not clear from his reasons: his Honour may have gone behind the payment claim to the underlying facts to determine whether there was one contract or more than one, or alternatively this may have been patent on the payment claim itself.
"... it should be possible to treat the inclusion of such an obviously erroneous item in a payment claim as not depriving an adjudicator of jurisdiction. The jurisdiction is to determine the extent and value of construction work under s 26 and the inclusion of a claim for an obviously irrelevant item for what is not construction work does not deprive the adjudicator of that jurisdiction."
[170]
[99] I am also inclined to think that if a payment claim is ex facie made under one construction contract, the adjudicator's jurisdiction is enlivened. If the adjudicator finds that some of the construction work was performed pursuant to some other contract (whether or not a "construction contract"), he or she is not deprived of jurisdiction to determine the extent and value of the construction work performed under the construction contract. Any error in the determination of the extent or value of the construction work would be an error of fact and not of jurisdiction.
[171]
[100] However, without first determining what constituted the contract, I cannot determine whether the payment claim related to more than one construction contract. Thus, the second jurisdictional question cannot be decided on this application.
[172]
[101] In the circumstances, the third jurisdictional question does not arise for determination.
[173]
[102] I have found that the adjudication decision was void for want of jurisdiction because the dismantling of the plant was not "construction work" under a "construction contract". I will hear the parties on the form of the order and on costs.
[2] See Pearce & Geddes Statutory Interpretation in Australia (2011, 7th ed) at [2.11], [4.49] and the cases cited there, including IW v City of Perth[1997] HCA 30; (1997) 191 CLR 1 at 12 and Municipal Officers' Association of Australia v Lancaster[1981] FCA 151; (1981) 54 FLR 129 at 153.
[14]Capricorn Quarries Pty Ltd v Inline Communication Construction Pty Ltd & ors [2012] QSC 388 at [45] per Jackson J.
[182]
[15]Minister Administering the Crown Lands Act v NSW Aboriginal Land Council (2008) 237 CLR 285 at 288-9; Bull v Attorney-General (NSW)[1913] HCA 60; (1913) 17 CLR 370 at 384. See also Pearce & Geddes op. cit. at [9.2].
[21] See also the reasoning of Spigelman CJ (in dissent) in Victims Compensation Fund Corp v Brown[2002] NSWCA 155; (2002) 54 NSWLR 668 at 671-672. And for a trenchant criticism of the role of the "remedial statute" approach within the canons of construction, see Eskridge, Frickey & Garrett, Legislation and Statutory Interpretation, 2 ed, at 343-348. It is noteworthy that the approach does not receive detailed consideration in the more recent leading UK works on statutory interpretation: for example, Bennion, Bennion on Statutory Interpretation, 5 ed, at s 182; Greenberg, Craies on Legislation, 9 ed, at Ch 20; cf Pearce & Geddes, Statutory Interpretation in Australia, 7 ed, at [9.2] - [9.5].
[189]
[22] Oxford English Dictionary (2012) OED at 20 June 2013.
[190]
[23] Oxford English Dictionary (2012) OED at 20 June 2013.
[31]Commissioner of Main Roads v North Shore Gas Co Ltd[1967] HCA 41; (1967) 120 CLR 118 at 127 per Barwick CJ, McTiernan, Kitto and Taylor JJ. See also North Shore Gas Co Ltd v Commissioner of Stamp Duties[1940] HCA 7; (1940) 63 CLR 52 at 67 - 68 per Dixon J.
[42] Nor does it matter whether they form part of freehold or leasehold, because both are within the inclusive definition of "land" in the Acts Interpretation Act. See Lehrer at 370; Jennings Construction Ltd v Burgundy Royale Investments Pty Ltd (No 2)(1987) 162 CLR 153 at 163; Alcan (NT) Alumina Pty Ltd v Commissioner of Territory Revenue (Northern Territory)[2009] HCA 41; (2009) 239 CLR 27 at 32-33.
[47]Thiess Pty Ltd v Warren Brothers Earthmoving Pty Ltd[2012] QCA 276 at [56]; HM Hire Pty Ltd v National Plant and Equipment Pty Ltd[2013] QCA 6 at [27].
[212]
[48]Thiess Pty Ltd v Warren Brothers Earthmoving Pty Ltd[2012] QCA 276 at [3], [102] - [105].