JTS Trading Group Pty Ltd v Allroads Pty Ltd

• [1] On 28 February 2025 Callaghan J made orders joining Quarry Products Pty Ltd as the second plaintiff in this matter pursuant to s 135 of the Building Industry Fairness (Security of Payments) Act 2017 (BIF Act).
• [2] Allroads Pty Ltd was in liquidation at the time of that order but Quarry Products did not seek leave to bring its claim under s 471B of the Corporations Act 2001 (Cth) when that order was made. It seeks to remedy that oversight now.
• [3] The liquidator of Allroads has been served with this application but has not responded. The second defendant, the Department of Transport and Main Roads, has also been served but did not appear. On or about 27 March 2025, the solicitors for DTMR paid into court the amount claimed by Quarry Products.
• [4] JTS Trading Group Pty Ltd has been given leave to proceed under s 471B of the Corporations Act. The circumstances prevailing in this matter lead to the conclusion that there is no reason that leave should not also be granted to Quarry Products.
• [5] The problem which arises now is that, after the order was made by Callaghan J, Quarry Products sought to file a statement of claim but it was not accepted on the basis that it would be a procedural anomaly for there to be two separate statements of claim in the one proceeding.
• [6] To explain the situation, I need to consider s 135 of the BIF Act. That section provides:

135 Enforcing subcontractor's charge on behalf of other subcontractors

(1) An action to enforce a subcontractor's charge under this chapter may be brought by or on behalf of any number of subcontractors claiming subcontractors' charges.

(2) Every action brought by a subcontractor to enforce a subcontractor's charge is deemed to be also brought on behalf of every other subcontractor -

(a) who has given a notice of claim under section 122; and

(b) whose charge has not been extinguished under section 136(3); and

(c) who becomes a party to the action in accordance with Uniform Civil Procedure Rules 1999 and subsection (3).

(3) Subject to the Uniform Civil Procedure Rules 1999, a subcontractor may become a party at any time before the date appointed for the hearing or any adjournment of the hearing.

• [7] The difficulty arises out of the provision which deems every action brought by a subcontractor to enforce a subcontractor's charge to be also brought on behalf of every other subcontractor. Quarry Products falls within s 135(2). Section 135(3) provides that the subcontractor may become a party "subject to the Uniform Civil Procedure Rules". It does not prescribe the way in which a subcontractor may become a party and I was not taken to any rule which specifically applies to this type of proceeding.
• [8] When the bill for the BIF Act was introduced the Building Industry Fairness (Security of Payment) Bill 2017 Explanatory Note contained the following:

"The Bill also repeals the Subcontractors' Charges Act 1974 (SCA) and places its provisions within the new Act. While it is intended that the legal effect of the provisions that are currently in the SCA will remain unchanged, the Bill seeks to improve usability of the SCA provisions."

"135 Enforcing subcontractor's charge on behalf of other subcontractors

Clause 135 is a new provision which is derived from subsections 12(3), 12(3A) and 12(3B) of the repealed SCA." (emphasis added)

• [9] Section 12 of the Subcontractors' Charges Act contained provisions similar to those contained in s 135 BIF Act. So far as deeming is concerned, the intention is the same. The provisions in the repealed Act, though, provide a more precise prescription with respect to the manner in which a subcontractor becomes a party. Section 12(3B) provided:

"Subject to any rules of the court, every such subcontractor may become a party at any time before the date appointed for the hearing or any adjournment thereof by filing in the court and serving on all other parties in the same manner as if the subcontractor were commencing the action a statement of claim endorsed with a request that the subcontractor be joined as a party in the proceedings."

• [10] It follows from the provisions of s 12(3B) that the intention of the legislation then was that there could be more than one statement of claim filed in the same matter.
• [11] The simple procedure envisaged in s 12(3B) of the Subcontractors' Charges Act has not been continued under the current legislation.
• [12] In order to deal with the absence of that procedure under the BIF Act it is appropriate that Quarry Products be granted leave to file a statement of claim in this matter notwithstanding that there is a statement of claim by the first plaintiff. When Quarry Products asked to be joined as a plaintiff it should (in addition to seeking leave under s 471B) have also sought a direction to file a statement of claim under r 69(3) UCPR:

"(3) If the court makes an order including or substituting a party, the court may give directions about the future conduct of the proceeding."

• [13] Quarry Products Pty Ltd has leave, pursuant to s 471B of the Corporations Act 2001 (Cth), to proceed against the first defendant.
• [14] Quarry Products Pty Ltd has leave to file a statement of claim in the form appearing in Exhibit CH-02 to the affidavit of Carl Hagon filed 30 May 2025.