Decision: the adjudicator had no power
21To understand how the adjudicator was able to derive an adjudicated amount, notwithstanding that he had not finalised item 25 (profit and overhead), variation 57, and the set-off for shop front deletions, it is necessary to understand what he did. Clearly, the adjudicator worked through the issues that the parties had posed. Clearly (and this appears from the reasons), as he reached a decision on each issue or group of issues, he finalised his decision and set out its monetary impact. No doubt, the adjudicator intended, when he had worked through all the issues in dispute, to produce a spreadsheet, similar to Annexure 1, setting out his determination on each of the disputed issues, and thus arriving at an adjudicated amount.
22As is apparent from para 207, what the adjudicator did, in respect of the three matters that I have identified, was adopt what he called the "scheduled amounts" specified in respect of each of them: that is to say, he adopted Cornerstone's valuation of those amounts. It is clear, and I do not think that for Parkview it was argued otherwise, that the adjudicator must have done this after 13 May 2014.
23The adjudicator, in para 207, referred to those amounts as "the scheduled amounts for those items". However, I do not think that this is a correct description. When one goes to s 13 of the Act, it requires a payment claim to identify a number of things, including (s 13(2)(b)) "the amount of the progress payment that the claimant claims to be due (the claimed amount)".
24Correspondingly, s 14(2)(b) requires a payment schedule, among other things, to "indicate the amount of the payment (if any) that the respondent proposes to make (the scheduled amount)".
25In other words, the scheduled amount is not a term that the statute intended to be used in respect of each and every item set out in the payment schedule as part of the reasons for withholding payment, and part of the justification of whatever amount (if any) the respondent proposes to pay. Instead, the scheduled amount is the amount (if any) that the respondent proposes to pay: that is to say, the amount calculated in the way that I have briefly described.
26Nonetheless, reading para 207 fairly, it is reasonably clear that the adjudicator said that because he could not make any determination in respect of the items referred to in the paragraph, he adopted the valuations of them that were contained in the payment schedule.
27In those circumstances, did the adjudicator, in the language of s 21(3) determine the application within the required time?
28It is necessary to pay some attention to what it is that an adjudicator is to do. That task is described in s 22:
22 Adjudicator's determination
(1) An adjudicator is to determine:
(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 such amount became or becomes payable, and
(c) the rate of interest payable on any such amount.
(2) In determining an adjudication application, the adjudicator is to consider the following matters only:
(a) the provisions of this Act,
(b) the provisions of the construction contract from which the application arose,
(c) the payment claim to which the application relates, together with all submissions (including relevant documentation) that have been duly made by the claimant in support of the claim,
(d) the payment schedule (if any) to which the application relates, together with all submissions (including relevant documentation) that have been duly made by the respondent in support of the schedule,
(e) the results of any inspection carried out by the adjudicator of any matter to which the claim relates.
(3) The adjudicator's determination must:
(a) be in writing, and
(b) include the reasons for the determination (unless the claimant and the respondent have both requested the adjudicator not to include those reasons in the determination).
(4) If, in determining an adjudication application, an adjudicator has, in accordance with section 10, determined:
(a) the value of any construction work carried out under a construction contract, or
(b) the value of any related goods and services supplied under a construction contract,
the adjudicator (or any other adjudicator) is, in any subsequent adjudication application that involves the determination of the value of that work or of those goods and services, to give the work (or the goods and services) the same value as that previously determined unless the claimant or respondent satisfies the adjudicator concerned that the value of the work (or the goods and services) has changed since the previous determination.
(5) If the adjudicator's determination contains:
(a) a clerical mistake, or
(b) an error arising from an accidental slip or omission, or
(c) a material miscalculation of figures or a material mistake in the description of any person, thing or matter referred to in the determination, or
(d) a defect of form,
the adjudicator may, on the adjudicator's own initiative or on the application of the claimant or the respondent, correct the determination.
29There is a distinction between the primary function of determining the matters set out in sub-s (1) and the obligation to justify that determination in writing and with reasons, being the obligation imposed by sub-s (3).
30In performing the obligation to determine (among other things) the amount of the progress payment (if any) to be paid, it was necessary for the adjudicator to go through all the disputes and, in a rational and considered way, to deal with them. It was then necessary for the adjudicator to reduce his reasons for doing so to writing, along with the determination itself.
31The determination that the adjudicator produced clearly recognised this. It contained two separate sections, one headed "Determination" and one headed "Reasons". Clearly enough, as will be seen from what I have set out above, it was the former of those sections that the adjudicator intended to be his performance of the s 22(1) task, on the facts of this particular case. Equally clearly, what follows was intended to comprise his reasons, for the purposes of s 22(3)(b).
32The essential point, however, is that the adjudicator could not have determined the amount of the progress payment without working his way through all the disputed issues that the parties had raised. What is equally apparent is that, as at 13 May 2014, he had not completed that task in respect of item 25 (profit and overhead), variation 57 and shop front deletions.
33Thus, if one were to ask, hypothetically, what had been decided as at 13 May 2014, the answer could only be: "The great bulk, but not all, of the matters in dispute." And until all the matters in dispute were decided, the determination of the amount of the progress payment could not be made.
34I have taken some time over that issue because Mr Christie of Senior Counsel, who appeared with Mr Vincent of Counsel for Parkview, submitted that if one stripped out the "post 13 May" items from the determination, there would be sufficient left to enable a careful reader, armed with a calculator, to work out what the adjudicated amount was. However, as will be apparent from what I have said, I am unable to accept that submission. I cannot accept it because, as at 13 June 2014, the adjudication had not dealt with all the issues in dispute. It was only once he had dealt with the remaining issues, after 13 June 2014, that he was able to arrive at an adjudicated amount. The fact that he arrived at the adjudicated amount by deciding some of the matters in the way for which Cornerstone had contended, does not detract from the self-evident proposition that, as at 13 May 2014, he had not done so at all.
35The statement in the "Determination", that the adjudicated amount was the amount "shown above", only makes sense if it is read in conjunction with the cover sheet. But the cover sheet, too, was something that had not been completed as at 13 May 2014; nor could it have been.
36Equally, the statement in para 208 of the amount of the entitlement "as set out in Annexure 1" could only have been meaningful once Annexure 1 itself was completed. Completion of Annexure 1 was possible only because the adjudicator, after 13 May 2014, completed his consideration of the matters in dispute, not by turning his mind independently to the issues that had not been dealt with, but, rather, by the expedient of adopting Cornerstone's position as stated in its payment schedule in respect of each of those items.
37In the circumstances, it seems to me that the adjudicator did not comply with his statutory obligation to determine the amount of the progress payment within the time fixed by s 21(3) of the Act. It follows that it was open to Parkview to do as it did on 14 May 2014, and withdraw the application. That right flowed from s 26 of the Act, which reads as follows:
26 Claimant may make new application in certain circumstances
(1) This section applies if:
(a) a claimant fails to receive an adjudicator's notice of acceptance of an adjudication application within 4 business days after the application is made, or
(b) an adjudicator who accepts an adjudication application fails to determine the application within the time allowed by section 21 (3).
(2) In either of those circumstances, the claimant:
(a) may withdraw the application, by notice in writing served on the adjudicator or authorised nominating authority to whom the application was made, and
(b) may make a new adjudication application under section 17.
(3) Despite section 17 (3) (c), (d) and (e), a new adjudication application may be made at any time within 5 business days after the claimant becomes entitled to withdraw the previous adjudication application under subsection (2).
(4) This Division applies to a new application referred to in this section in the same way as it applies to an application under section 17.
38Because the adjudicator had not completed the task by 13 May 2014, it necessarily follows, in my view, that he had failed to determine the application by that date. Thus, s 26(1)(b) was enlivened.
39There can be no dispute but that Parkview's letter of 14 May 2014 was an express and clear exercise of the right that, in my view, it then had.
40It follows inevitably, the adjudication application having been withdrawn on 14 May 2014, that it was not open to the adjudicator to do thereafter as he did (or purported to do) and complete his task, finalise the determination and reasons, and, through the ANA and once his fees had been paid, make them available to the parties. To put it another way, at the point in time when the adjudicator purported to make his determination on the matters in dispute, his power to do so had been revoked.
41I have not overlooked that the cover sheet suggests that the determination was made on 13 May 2014. However, that can be no more than a statement of what the adjudicator understood to be the effective date of the determination. It is clear from the evidence, including the material produced by the ANA, that the document which was ultimately issued was not finalised, in the form that it was ultimately issued, until 19 May 2014 at the earliest. Nor was the actual balance owing, being (in the adjudicator's mind) the adjudicated amount determined until that date at the earliest.