Court of Appeal (Qld)|2013-12-20|Before: Holmes and Muir JJA and Ann Lyons J, Separate reasons, for judgment of each member of the Court, each concurring as to the order, made
Holmes and Muir JJA and Ann Lyons J, Separate reasons, for judgment of each member of the Court, each concurring as to the order, made
Catchwords
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 theappellant (BMA) entered into a contractwith the first respondent (BGC) for theconstruction of a dam – where BGC served a payment claim on BMA pursuantto the Building and Construction Industry Payments Act 2004 (Qld) (theAct) which included claims for alleged latent conditions and termination costs– where the payment claim wasreferred to adjudication and BGC was awardeda progress payment which included sums on account of latent conditions andterminationcosts – where BMA sought a declaration that the adjudicationdecision was void as a result of three jurisdictional errors –where theprimary judge held that the adjudicator had made a jurisdictional error in thedetermination of the termination costs claim– where, on 13 November
2012, the primary judge declared the decision of the adjudicator void –
where, on 22 March 2013,
the primary judge revoked the declaration and dismissed
BMA’s application upon BGC undertaking to repay to BMA the portion
of the
adjudicated amount affected by jurisdictional error – where BMA submits
that the primary judge’s conclusion that
a decision affected by
jurisdictional error was not necessarily invalid for all purposes and has some
residual effect was an error
of law – whether the primary judge erred in
finding that the adjudication decision, which he held to be affected by
jurisdictional
error, retained effect until he exercised his discretion to grant
a declaration or make an order quashing or setting aside the decision
–
whether the primary judge erred in law in withholding the relief sought by BMA
– whether the matter should be remitted
to the adjudicator for
determination according to law
CONTRACTS – BUILDING, ENGINEERING AND RELATED CONTRACTS –
REMUNERATION – STATUTORY REGULATION OF ENTITLEMENT TO
AND RECOVERY OF
PROGRESS PAYMENTS – ADJUDICATION OF PAYMENT CLAIMS – where
cl 26.3(b) of the contract requires BGC to
give written notice to BMA of
the encountering of latent conditions – where, within 10 business days of
notification, the parties
must “negotiate in good faith any changes to the
Price and/or time for completion of the Services as a result of Latent
Conditions”
and, in the absence of agreement, must refer the matter to an
independent expert for determination – where the primary judge
held that
cl 26.3 was predicated on the existence of latent conditions and any
dispute as to their existence was to be resolved by
the general dispute
resolution provision, cl 37 – where, contrary to BMA’s
contentions, the primary judge held that the
fact that the machinery for
assessment of value under the clause had not been advanced did not alter
BGC’s entitlement under
the contract to be paid in respect of a latent
condition – where the primary judge held that the award by the adjudicator
in
respect of latent conditions did not constitute a jurisdictional error
– where BMA contends that cl 26.3 was intended to deal
with all
aspects of a dispute concerning latent conditions, including the determination
of the existence of a latent condition –
whether cl 26.3 operates
subject to the determination of the existence of latent conditions under
cl 37 – whether the adjudicator
committed a jurisdictional error in
awarding BGC a progress payment which included a sum in respect of latent
conditions
INTEREST – RATE OF INTEREST AND COMPOUND INTEREST – RATE IN
OTHER CASES – where BMA sought interest on the sums
repayable to it at the
rate prescribed in practice directions for default judgments – where the
primary judge accepted BGC’s
contentions that the appropriate rate was
that payable on term deposits with financial institutions – where
BGC’s evidence
of commercial rates of interest awarded on investments was
uncontested – whether the primary judge erred in accepting and acting
on
evidence of commercial interest rates when awarding interest on the sum
repayable to BMA
Building and Construction Industry Payments Act 2004 (Qld),
s 12, s 13, s 14, s 18, s 26, s 30,
s 31
Civil Proceedings Act 2011 (Qld), s 58(3),
s 59(3)
Atlantic Civil Pty Ltd v Water Administration Ministerial
Chase Oyster Bar Pty Ltd v Hamo Industries Pty Ltd (2010)
78 NSWLR 393
[2010] NSWCA 190, cited
Clyde Bergemann v Varley
Power [2011] NSWSC 1039, considered
Craig v South Australia (1995)
184 CLR 163
[1995] HCA 58, considered
Emergency Services
Superannuation Board v Davenport [2004] NSWSC 697,
considered
Interchase Corporation Ltd (in liq) v Grosvenor Hill
(Queensland) Pty Ltd (No 3) [2003] 1 Qd R 26
[2001]
QCA 191, cited
Jackson v Purton [2011] TASSC 28,
cited
Jadwan Pty Ltd v Secretary, Department of Health and Aged Care
(2003) 145 FCR 1
[2003] FCAFC 288, considered
Kirk v Industrial
Court (NSW) (2010) 239 CLR 531
[2010] HCA 1,
considered
Lansen v Minister for Environment and Heritage (2008)
174 FCR 14
[2008] FCAFC 189, cited
Leung v Minister for
Immigration and Multicultural Affairs (1997) 79 FCR 400
[1997]
FCA 1313, considered
Minister for Immigration and Multicultural Affairs v
Bhardwaj (2002) 209 CLR 597
[2002] HCA 11,
considered
Minister for Immigration and Multicultural and Indigenous
Affairs v SGLB (2004) 78 ALJR 992
[2004] HCA 32,
cited
Morris v Riverwild Management Pty Ltd (2011)
284 ALR 413
[2011] VSCA 283, cited
Plaintiff S157/2002 v The
Commonwealth (2003) 211 CLR 476
[2003] HCA 2,
considered
R v Commonwealth Court of Conciliation and Arbitration
Ex
parte Ozone Theatres (Aust) Ltd (1949) 78 CLR 389
[1949] HCA 33,
cited
Serisier Investments Pty Ltd v English [1989]
1 Qd R 678, cited
South East Civil & Drainage
Contractors P/L v AMGW P/L & Ors [2013] 2 Qd R 189
[2013] QSC 45,
cited
SZFDE v Minister for Immigration and Citizenship (2007)
232 CLR 189
[2007] HCA 35, cited
Truenergy Australia Pty Ltd v
Minister for Industrial Relations (2005) 93 SASR 393
[2005] SASC
490, cited
Judgment (124 paragraphs)
[1]
The application filed 18 May 2012 is dismissed.
There be no order as to costs."
[2]
[51] In reasons given on 22 March 2013, the primary judge stated that when he delivered his initial reasons he anticipated making a declaration that the adjudicator's decision was void and making consequential orders, including an order remitting the matter to the adjudicator for reconsideration. The parties made further written and oral submissions about the appropriate orders that should be made. BMA contended that the adjudicator's decision should be declared void; that BGC should be restrained from enforcing or otherwise relying on the decision; and that BGC should be ordered to repay the $26,135,709.37 it had been paid by BMA on 16 May 2012 together with interest and GST. BGC contended that on its undertaking to pay to BMA within 14 days $4,345,377.42 together interest thereon from 16 May 2012 and a further sum on account of GST paid by BMA to BGC, the application should be dismissed.
[3]
[52] The primary judge discussed authorities concerned with the power of a court to decline to grant prerogative remedies and to make declaratory orders on discretionary grounds. His Honour identified as a critical issue:[25]
[4]
"... whether the form of conditional order proposed by BGC represents 'a more convenient and satisfactory remedy' than an order declaring the decision void, together with an order for the repayment of the adjudicated amount in full, along with interest. More generally, the issue is whether the circumstances make it just to withhold the declaratory and other relief sought by BMA in the circumstances, which include the objectives of the Act, the nature of the jurisdictional error, its ascertainable monetary consequences and BGC's undertaking to remedy those consequences by repaying to BMA the component of the adjudicated amount, together with interest and GST."
[5]
[53] The primary judge then considered the effect of a decision such as that of the adjudicator until set aside or declared void. His Honour referred to Emergency Services Superannuation Board v Davenport,[26] in which McDougall J upheld two of the plaintiff's three challenges to the validity of the adjudicator's determination. McDougall J indicated that he was prepared to grant the plaintiff relief on condition that the plaintiff pay the contractor the unaffected amount of the determination, together with interest thereon, in accordance with the determination. The plaintiff accepted the imposition of the condition.
[6]
[54] In Cardinal Project Services Pty Ltd v Hanave Pty Ltd,[27] Basten JA, after observing that the amount included in the condition proposed by McDougall J in Davenport was not "arbitrarily selected" and was justified by reference to the otherwise invalid determination, said:[28]
[7]
"Such an approach has much to recommend it, particularly, it might be added, if the claimant is otherwise unable to pursue its original payment claim to achieve a second adjudication. However, such conditional relief can itself only be valid if it is designed to achieve a legitimate purpose: cf Minister for Immigration and Multicultural Affairs v Wang[2003] HCA 11; (2003) 215 CLR 518 at [15]-[16] (Gleeson CJ); [39] (McHugh J); [68] Gummow and Hayne JJ). If the determination is indeed legally ineffective in all respects, it would be doubtful whether the court could condition declaratory relief (or an order setting aside the decision) upon the applicant making such payment as would be required by the determination if validity could be determined part by part, like the curate's egg. Accordingly, the underlying assumption was inconsistent with total invalidity for all purposes."
[8]
[55] The primary judge noted[29] that he was not invited by BGC to make an order which conditioned the declaratory relief (or an order setting aside the decision) upon a requirement that BMA pay the unaffected amount. He said in that regard:[30]
[9]
"Basten JA observes in the passage [quoted in paragraph [54] above], an order of that kind, as made in Emergency Services Superannuation Board v Davenport, is inconsistent with the proposition that a determination affected by jurisdictional error carries the consequence of 'total invalidity for all purposes.' I respectfully follow his Honour's discussion of the concept of nullity."
[10]
[56] The primary judge then discussed authorities including Minister for Immigration and Multicultural Affairs v Bhardwaj;[31] Leung v Minister for Immigration and Multicultural Affairs;[32] and Jadwan Pty Ltd v Secretary, Department of Health and Aged Care.[33]
"[29] ... In a case in which the decision is challenged, and the Court declines to declare it invalid for a discretionary reason, the decision will remain binding. In other cases, a decision affected by jurisdictional error, such as a denial of natural justice, will lack validity without the need for a challenge in proceedings as to its validity, for example, where the decision-maker appreciates there has been a jurisdictional error and treats the decision as no decision at all.
[13]
[32] The [adjudicator's] decision did not cease to have legal and other consequences upon BMA challenging it for jurisdictional error on three grounds, two of which failed, or even upon my finding that the third ground of alleged jurisdictional error was established. It continued to have operational effect and also provided the legal justification for BGC to retain the money which had been paid to it pursuant to the decision. An order declaring the decision void might be made conditional upon the payment of a certain amount, in the form of an order of the kind made in Emergency Services Superannuation Board v Davenport. As Basten JA observes, such an approach has much to recommend it, particularly if the claimant is otherwise unable to pursue its original payment claim to achieve a second adjudication. However, I have yet to make a declaration that the decision is void. As matters stand, the decision does not lack effect notwithstanding my finding of jurisdictional error. It retains effect unless and until I exercise my discretion to grant a declaration or make an order quashing or setting aside the decision." (emphasis added)
[14]
[58] His Honour rejected submissions by BMA that a refusal to make the declaration it sought would "clothe the decision with a measure of legal validity", remarking, "The decision already has a measure of validity".[35]
[15]
[59] After considering the competing arguments as to whether remittal of the matter to the adjudicator was permissible, and/or desirable, his Honour concluded that the most satisfactory course was to make the order he eventually made. His Honour's reasons for adopting this course were:
[16]
such an order was "best suited to correct the error which resulted in the determination of an amount in excess of jurisdiction and to achieve a just result, being the result that would have been achieved had the adjudication decision been made without jurisdictional error";[36]
it would avoid the risk of further litigation and the cost and complexity in relation to the conduct of a further adjudication;[37]
it would avoid BGC being deprived of approximately $24,000,000;[38] and
it would avoid any doubt about whether remittal was possible.[39]
[17]
[60] BMA argued that the primary judge's conclusion that a decision affected by jurisdictional error was not necessarily invalid for all purposes and had some residual effect was an error of law. In particular, BMA complained about the conclusion that the adjudicator's decision "retains effect unless and until [the primary judge] exercise[s] [his] discretion to grant a declaration or make an order quashing or setting aside the decision".[40] In support of its contentions, BMA referred to Bhardwaj;[41] Plaintiff S157/2002 v The Commonwealth;[42] Minister for Immigration and Multicultural and Indigenous Affairs v SGLB;[43] and SZFDE v Minister for Immigration and Citizenship.[44]
[18]
[61] BGC sought to uphold the primary judge's findings under consideration, relying, in particular, on Truenergy Australia Pty Ltd v Minister for Industrial Relations;[45] Jackson v Purton;[46] and Jadwan.[47] It was further submitted that the provisions of the Act did not support a conclusion that an adjudicator's decision affected by jurisdictional error is necessarily of no legal effect. I will refer to the basis for this submission later.
[19]
[62] In Bhardwaj, Gaudron and Gummow JJ, with whose reasons McHugh J relevantly agreed, said:[48]
[20]
"There is, in our view, no reason in principle why the general law should treat administrative decisions involving jurisdictional error as binding or having legal effect unless and until set aside. A decision that involves jurisdictional error is a decision that lacks legal foundation and is properly regarded, in law, as no decision at all. Further, there is a certain illogicality in the notion that, although a decision involves jurisdictional error, the law requires that, until the decision is set aside, the rights of the individual to whom the decision relates are or, perhaps, are deemed to be other than as recognised by the law that will be applied if and when the decision is challenged. A fortiori in a case in which the decision in question exceeds constitutional power or infringes a constitutional prohibition."
"In general, judicial orders of superior courts of record are valid until they are set aside on appeal, even if they are made in excess of jurisdiction. By contrast, administrative acts and decisions are subject to challenge in proceedings where the validity of that act or decision is merely an incident in deciding other issues. If there is no challenge to the validity of an administrative act or decision, whether directly by proceedings for judicial review or collaterally in some other proceeding in which its validity is raised incidentally, the act or decision may be presumed to be valid. But again, that is a presumption which operates, chiefly, in circumstances where there is no challenge to the legal effect of what has been done. Where there is a challenge, the presumption may serve only to identify and emphasise the need for proof of some invalidating feature before a conclusion of invalidity may be reached. It is not a presumption which may be understood as affording all administrative acts and decisions validity and binding effect until they are set aside. For that reason, there is no useful analogy to be drawn with the decisions of the Court concerning the effect of judgments and orders of the Federal Court of Australia made in proceedings in which that Court had no constitutionally valid jurisdiction.
[23]
This is not to adopt what has sometimes been called a 'theory of absolute nullity' or to argue from an a priori classification of what has been done as being 'void', 'voidable' or a 'nullity'. It is to recognise that, if a court would have set the decision aside, what was done by the Tribunal is not to be given the same legal significance as would be attached to a decision that was not liable to be set aside. In particular, it is to recognise that if the decision would be set aside for jurisdictional error, the statutory power given to the Tribunal has not been exercised ...
[24]
Nothing in the Act requires (or permits) the conclusion that despite the jurisdictional error, some relevant legal consequence should be attributed to the September decision. In particular, the fact that the Federal Court had only limited jurisdiction to review the decision does not lead to the conclusion that the September decision is to be treated as having some effect. Once it is recognised that a court could set it aside for jurisdictional error, the decision can be seen to have no relevant legal consequences." (citations omitted)
[25]
[64] In Plaintiff S157/2002, Gaudron, McHugh, Gummow, Kirby and Hayne JJ, referring to passages from the reasons of Gaudron and Gummow JJ,[50] McHugh J[51] and Hayne J[52] in Bhardwaj, said:[53]
[26]
"This Court has clearly held that an administrative decision which involves jurisdictional error is 'regarded, in law, as no decision at all'." (citations omitted)
[27]
[65] Finkelstein J observed in Leung,[54] in a passage implicitly approved of by Gleeson CJ in Bhardwaj:[55]
[28]
"There is no doubt that an invalid administrative decision can have operational effect. For example it may be necessary to treat an invalid administrative decision as valid because no person seeks to have it set aside or ignored. The consequence may be the same if a court has refused to declare an administrative decision to be invalid for a discretionary reason. In some circumstances the particular statute in pursuance of which the purported decision was taken may indicate that it is to have effect even though it is invalid or that it will have effect until it is set aside."
[29]
[66] BGC relied on these observations and on a number of decisions of the Full Court of the Federal Court, including Jadwan, which expressed the view that whether jurisdictional error on the part of a tribunal or decision maker will render the decision nugatory for all purposes may depend on the terms of the statute under which the decision was made.[56] That proposition, with respect, may be accepted but, absent statutory provisions necessitating a contrary conclusion, the general principle identified in paragraphs [62]-[57] above applies.57
[30]
[67] BGC identified two matters which it claimed demonstrated a legislative intention that an adjudicator's decision affected by jurisdictional error not be deprived of any legal effect:
[31]
The absence of a statement in the Act that an adjudicator's decision affected by jurisdictional error lacked legal effect and the mechanism provided by s 30 and s 31 of the Act whereby an adjudication certificate may be obtained and "filed as a judgement for a debt, and may be enforced, in a court of competent jurisdiction".[58]
The "pay now, argue later" nature of the scheme.
[32]
[68] The fact that the Act provides for a simple expeditious and robust mechanism for ensuring the payment of progress claims does not, of itself, support the conclusion for which BGC contends. The Act also provides a relatively straightforward framework which facilitates compliance. I am unable to detect anything in the Act which indicates a legislative intention that the benefits provided to claimants and the corresponding detriments to respondents under the Act should exist irrespective of whether there has been compliance with the Act's provisions. To the contrary, some of the Act's provisions are expressed in peremptory language.[59]
[33]
[69] Sections 30 and 31 are merely machinery provisions to enable the enforcement of adjudication decisions which provide for the payment of money. Without such provisions, an adjudication decision that a sum of money was payable to a claimant would lack practical consequences.
[34]
[70] As BMA submitted, respondents under the Act do not have the benefit of decisions made after mature consideration based on evidence admitted under the evidentiary rules applied in Court proceedings and tested by cross-examination. Nor do they have any right of appeal. Respondents are afforded a measure of protection only by strict compliance with the provisions of the Act.
[35]
[71] Whatever the position might be if the parties to an adjudication make no complaint about the adjudication decision, the decisions of the High Court relied on by BMA make it plain that once a court determines that a decision of the type in question is affected by jurisdictional error, the decision cannot give rise to legal consequences.
[36]
[72] On 13 November 2012, not only did the primary judge find jurisdictional error resulting in the invalidity of the adjudication decision, he declared the decision void. Even without the declaration, it necessarily followed from the findings in the 13 November reasons, that the adjudication decision had no legal effect. It is difficult to see how the declaration that the decision was void could have been revoked, but no issue about that was raised in the grounds of appeal or in argument.
[37]
[73] There was no suggestion at first instance or on appeal that BMA did not have a legally enforceable right to the repayment of the sum of $26,135,709.37. The primary judge's 22 March 2013 orders effectively defeated that right, except in respect of the $4,345,377.42, and interest, relating to the termination costs claim.
[38]
[74] In order to justify the revocation of the 13 November 2012 declaration and the making of the 22 March 2013 orders, the primary judge relied on the existence of a discretion as to whether to grant declaratory relief even though a legal basis for the making of the subject declaration existed. His Honour identified as a relevant circumstance the existence of "alternative and adequate remedies for the wrong of which complaint is made".[60]
[39]
[75] The primary judge then, with respect, proceeded to deny BMA the remedy dictated by the finding of jurisdictional error. In so doing, the primary judge was motivated by a desire to allow BGC to retain the amounts which the adjudicator had allowed and to which BGC would have been entitled had there been no jurisdictional error. In his Honour's view, "[s]uch a course advances the policy of the Act".[61] It is not clear what connection, if any, existed between this rationale and the existence of an alternative and adequate remedy.
[40]
[76] As previously discussed, there is nothing in the Act which would support the denial to a respondent to a payment claim of its rights and entitlements under the Act except to the extent that the Act expressly or implicitly so provided. Nor is there any principle identified which would authorise a court to deny a litigant a legal right or remedy on the grounds that the policy of an Act would thereby be advanced. In this case the matters discussed in respect of the latent conditions claim indicate that a failure to permit BMA to enjoy the normal benefits of its success in the proceeding were unlikely to assist in advancing the policy of the Act but were likely to cause injustice. It is also relevant that the primary judge's refusal to grant appropriate declaratory relief may well have left it open to BMA to bring other proceedings to recover the monies paid by it to BGC.[62]
[41]
[77] The adjudication decision gave BGC no entitlement to payment of any part of the adjudication amount as BMA had no obligation to pay it. BMA, having paid it, had a right to recover it. The primary judge erred in law in withholding the relief sought by BMA. His Honour also erred in finding in his 22 March 2013 reasons that the adjudication decision, which he held to be affected by jurisdictional error, retained effect until he exercised his discretion to grant a declaration or make an order quashing or setting aside the decision.
[42]
[78] For the above reasons, the primary judge's orders of 22 March 2013 should be set aside.
[43]
Ground 4 - the primary judge erred in accepting and acting upon evidence of commercial interest rates when awarding interest on the sum repayable to BMA in circumstances where no sufficient basis was made out to justify such a course
[44]
[79] BMA sought interest on the sums repayable to it at the rate prescribed in practice directions for default judgments. BGC contended that the appropriate rate was that payable on term deposits with financial institutions. It adduced evidence in that respect. BMA referred to Serisier Investments Pty Ltd v English,[63] in which Thomas J said:
[45]
"It would be undesirable to encourage the calling of accountants or other experts to give evidence on applicable rates of interest in every case or even frequently. This would lead to multiplicity of issues, increase in costs and waste of human resources."
[46]
[80] It was submitted that the principle expressed by Thomas J accorded with the practice of the court in awarding interest at an established rate, unless some other rate is shown to be more appropriate. In that regard, BMA referred to McPherson JA's observation in Interchase Corporation Ltd (in liq) v Grosvenor Hill (Queensland) Pty Ltd (No 3)[64] that "In Queensland, a simple interest rate of 12 per cent p.a. has generally been applied under s. 47 [of the Supreme Court Act 1995 (Qld)] since about 1985 or earlier."
[47]
[81] It was submitted that the current practice in Queensland was to award interest at the rate prescribed in practice directions from time to time[65] and that a similar practice existed in New South Wales.[66]
[48]
[82] According to the argument, the statement of principle in Serisier Investments Pty Ltd and the practice of the Court reflect the undesirability of encouraging disputes over an appropriate interest rate and are inconsistent with a departure from the generally applied rate simply because it differs from prevailing commercial interest rates. To entertain such departures from the norm would encourage frequent disputation over the appropriate rate as commercial interest rates regularly differ. Consequently, it was submitted, BGC bore the onus of demonstrating that there was a rate of interest more appropriate than the prescribed rate. It could not discharge the onus by merely introducing evidence of different commercial interest rates. The primary judge gave no reason for adopting the deposit investment rate, beyond concluding that the evidence of such was admissible.[67] That finding, however, did not demonstrate that the deposit rates were more appropriate to compensate a large mining company for the loss of its money than interest at the rate set in a practice direction. The primary judge reversed the onus of proof when he stated that BMA had put on no evidence as to how the money would have been used.[68]
[49]
[83] The substance of the primary judge's reasons may be summarised as follows. BGC's evidence of "commercial rates of interest awarded on investments"[69] was uncontested. BMA led no evidence as to commercial rates of interest or rates relevant to its having been denied the use of the money. There was no reason to suppose that the money in question would not have been held by BMA in a bank deposit if it had not been paid to BGC. Consequently, the rate of four per cent per annum put forward by BGC on the basis of the evidence adduced by it as the commercial rate applicable to investments was appropriate.
[50]
[84] BGC contended that the submission in relation to the practice in New South Wales in relation to awards of interest was not accurate.[70]
[51]
[85] BMA did not contend that there was any requirement under statute or the Uniform Civil Procedure Rules 1999 (Qld) for the primary judge to apply the interest rate applicable to default judgments. Section 58(3) of the Civil Proceedings Act 2011 (Qld) provides for the payment of pre-judgment interest "at the rate the court considers appropriate". It was not contended that the primary judge was not entitled to award interest nor was it submitted that the primary judge was bereft of a discretion in that regard.
[52]
[86] The object of the award of interest was to compensate BMA for the loss of the use of the subject monies. The approach adopted by the primary judge, having regard to the limited evidence before him, was apt to serve that end. No error of principle was made out. As the orders made on 22 March 2013 should be set aside, it is appropriate that interest at the rate of 8.75 per cent per annum be awarded from 3 October 2012, the date on which the original declaration in favour of BMA was made. That is the rate of interest prescribed by Practice Direction No 7 of 2013, pursuant to s 59(3) of the Civil Proceedings Act 2011 (Qld), in respect of money orders.
[53]
[87] BGC submitted that, in the event that BMA's appeal succeeded, the matter should be remitted to the primary judge for a determination of whether the adjudication application should be remitted to the adjudicator. Such an order would not be desirable in my view. It would cause these proceedings to be further prolonged. In his reasons of 22 March 2013, the primary judge explained that he had resiled from his original intention to order that the matter be remitted to the adjudicator. That was because of doubts raised by BMA as to whether such a course was open and, if it was open, whether remittal was appropriate in the circumstances. This Court heard no argument on whether remittal to the adjudicator was legally possible. Also, it may be doubted, having regard to the above discussion on the latent conditions question, that remittal to the adjudicator would be desirable.
[54]
[88] For the above reasons, I would order to the effect that:
[55]
3. The first respondent pay to the appellant the sum of $26,135,709.37.
[56]
4. The first respondent pay to the appellant interest on such sum at the rate of four per cent per annum from 16 May 2012 until 3 October 2013 and from that date until today's date at the rate of 8.75 per cent per annum.
[57]
5. The first respondent pay to the appellant the sum of $2,613,570.94 being the sum paid by the appellant to the respondent in respect of GST.
[58]
6. The first respondent pay to the appellant interest on the sum of $2,613,570.94 from 16 May 2012 at the rate of four per cent per annum and from 13 November 2012 until today's date at the rate of 8.75 per cent per annum.
[59]
7. The first respondent pay the appellant's costs of the proceedings including the costs of this appeal.
[60]
[89] On the hearing of the appeal, the precise terms of the order sought by BMA in the event that it succeeded on the appeal were not identified. In particular, if there was evidence of dates of payment and partial repayment of monies, it was not identified. This Court should not have to scour the appeal record in an attempt to find facts necessary for the formulation of an order. The appellant should be directed to consult with the respondent and bring in draft minutes of order reflecting these reasons within 28 days of today's date. The rather leisurely period allowed takes the Christmas and New Year period into account.
[61]
[90] A LYONS J: I agree with his Honour's reasons and the orders proposed.
[62]
[1]BM Alliance Coal Operations Pty Ltd v BGC Contracting Pty Ltd & Ors[2012] QSC 346 at [19].
[34]BM Alliance Coal Operations Pty Ltd v BGC Contracting Pty Ltd & Ors (No 2)[2013] QSC 67 at [29] and [32].
[89]
[35]BM Alliance Coal Operations Pty Ltd v BGC Contracting Pty Ltd & Ors (No 2)[2013] QSC 67 at [38].
[90]
[36]BM Alliance Coal Operations Pty Ltd v BGC Contracting Pty Ltd & Ors (No 2)[2013] QSC 67 at [42].
[91]
[37]BM Alliance Coal Operations Pty Ltd v BGC Contracting Pty Ltd & Ors (No 2)[2013] QSC 67 at [43].
[92]
[38]BM Alliance Coal Operations Pty Ltd v BGC Contracting Pty Ltd & Ors (No 2)[2013] QSC 67 at [43].
[93]
[39]BM Alliance Coal Operations Pty Ltd v BGC Contracting Pty Ltd & Ors (No 2)[2013] QSC 67 at [45].
[94]
[40]BM Alliance Coal Operations Pty Ltd v BGC Contracting Pty Ltd & Ors (No 2)[2013] QSC 67 at [32].
[95]
[41]Minister for Immigration and Multicultural Affairs v Bhardwaj[2002] HCA 11; (2002) 209 CLR 597 at 614-615 [50]-[51] per Gaudron and Gummow JJ; at 618 [63] per McHugh J; at 646-647 [152]-[153] per Hayne J.
[65] See e.g. Fulcher & Ors v Knott Investments Pty Ltd & Ors[2012] QSC 232 at [173]-[174]; Cashmere Bay Pty Ltd v Hastings Deering (Australia) Ltd (No. 2)[2011] QSC 134 at [23]-[24].
[120]
[66]Hexiva Pty Limited & Ors v Lederer & Ors[2007] NSWSC 49 at [16]. In Interchase Corporation Ltd at [65], MacPherson JA considered it appropriate to consider the rates and practice in New South Wales.
[121]
[67]BM Alliance Coal Operations Pty Ltd v BGC Contracting Pty Ltd & Ors (No 2)[2013] QSC 67 at [51].
[122]
[68]BM Alliance Coal Operations Pty Ltd v BGC Contracting Pty Ltd & Ors (No 2)[2013] QSC 67 at [52]-[53].
[123]
[69]BM Alliance Coal Operations Pty Ltd v BGC Contracting Pty Ltd & Ors (No 2)[2013] QSC 67 at [50].
[124]
[70] Practice Note SC Gen 16 provides that pre-judgment interest can be expected to be included in a judgment at a rate which is referred to a cash rate last published by the Reserve Bank prior to commencement of the pre-judgment period. Federal Court practice note CM 16 is to like effect.
Parties
Applicant/Plaintiff:
# BM Alliance Coal Operations Pty Ltd
Respondent/Defendant:
BGC Contracting Pty Ltd & Ors \[2013\] QCA 394
Legislation Cited (6)
Building and Construction Industry Payments Act 2004(Qld)