CWDS Worker's Liens Act - charge under section 7(2) - whether section 48 excludes monies in the hands of the government from being the subject of a charge - Ready Mixed Concrete (SA) Pty Ltd v. Constructions (Broken Hill) Pty Ltd and Ors 1963 SASR 340 approved and applied - appeal against summary judgment dismissing claim against Minister dismissed.

HRNG ADELAIDE, 2 September 1991 #DATE 3:10:1991 Counsel for Appellant: Mr C J Townsend Solicitors for Appellant: Cowell Clarke Counsel for 2nd Respondent: Mr J J Doyle, QC with Mr W P White Solicitor for 2nd Respondent: B M Selway Crown Solicitor

JUDGE1 KING C.J. The first defendant, Arthur Lloyd Pty Ltd, contracted with the second defendant, Minister for Public Works, to execute certain building works as part of "F" Division at Yatala Labour Prison. The plaintiff, Bettaform Pty Ltd, subcontracted with the first defendant to execute for it certain parts of those building works. The Statement of Claim claims the sum of $305,507.95 alleged to be due under that contract by the first defendant. The Statement of Claim also claims against the second defendant the Minister for Public Works an order for the enforcement of a charge for that sum against the contract monies payable by the Minister to the first defendant which charge is said to arise under the Worker's Liens Act 1893. 2. The defence filed on behalf of the Minister pleads that the plaintiff's charge is unenforceable by virtue of section 48 of the Worker's Liens Act. The Minister applied to the court for summary judgment dismissing the plaintiff's action against the Minister. The argument for the Minister was that the charge under the Worker's Liens Act would operate to change the liability of Her Majesty and was therefore excluded by section 48 of the Act. Master Bowen Pain gave summary judgment dismissing the plaintiff's action against the Minister. The plaintiff has appealed to this court. 3. The charge which the plaintiff claims, is said to arise under section 7(2) of the Worker's Liens Act. That subsection is as follows: "A sub-contractor shall have a charge on any money payable to the contractor or sub-contractor with whom he shall have contracted for that portion of the contract price payable to the first-mentioned sub-contractor in respect of work done or materials furnished or manufactured for the purposes of the contract of such contractor or secondly mentioned sub-contractor." 4. Section 48 of the Act is as follows: "Nothing in this Act contained shall create or give any right

or remedy against land vested in Her Majesty or in any person for or on behalf of the Government or increase or change the liability of Her Majesty, or of any person procuring the performance of work for or on behalf of the Government and, except as between the contractors, sub-contractors, and workers, this Act shall not apply to such work." 5. The argument for the plaintiff before us was that section 48 did not operate to deny the existence of a charge on monies due by the government but operated only to preclude enforcement of such a charge. It was said that change in the liability of the government arose not from the existence of the charge but from its enforcement by legal action. It was said that that argument gains support from a dictum of Gaudron J. in Jennings Construction Limited v. Burgundy Royale Investments Pty Ltd [1987] HCA 10; (1987) 162 CLR 153 at pp 167-168. I am unable to see in any of the dictum cited any semblance of support for the plaintiff's argument. 6. Subsection (5) of section 7 of the Act provides that "a charge under this section shall not avail as to any monies bona fide paid over without notice of such charge." It is clear from that subsection, if it were not otherwise clear, that notice of a charge has the effect that the party liable to pay can no longer pay the amount due to the contractor and obtain a discharge from him, but that he becomes liable to pay the amount to the subcontractor giving notice of the charge. Where the party liable to pay is the government, this clearly, to my mind, effects a change in the liability of Her Majesty. This was the view of Chamberlain J. in Ready Mixed Concrete (S.A.) Pty Ltd v. Constructions (Broken Hill) Pty Ltd and Ors (1963) SASR 340, who held that section 48 operates to exclude monies in the hands of the Crown from being the subject of a charge under the Act. I consider that the decision in that case was clearly right. 7. In my opinion section 48 of the Act is a clear answer to the plaintiff's claim against the second defendant and the learned Master was correct in giving summary judgment dismissing the claim against the second defendant.

JUDGE3 DUGGAN J. In my view this appeal should be dismissed for the reasons given by the Chief Justice.