Selected cases

High Court of Australia · [2018] HCA 4

Probuild v Shade Systems

A High Court construction case about security of payment adjudications and the limits of judicial review.

High Court of Australia14 Feb 2018

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Quick read

  • Security of payment adjudications are designed to be fast and hard to unwind.
  • A High Court construction case about security of payment adjudications and the limits of judicial review.

Use this to check

  • Security of payment determinations can be difficult to challenge for non-jurisdictional legal error.
  • Payment schedules and adjudication responses need rapid legal and factual review.
  • Jurisdictional objections should be identified early, not after the result is bad.

Decision snapshot

  1. What happened

    • Probuild and Shade Systems were involved in a NSW construction payment dispute under security of payment legislation.
    • After an adjudicator determined that Probuild owed Shade Systems money, Probuild sought judicial review, arguing there had been an error of law.
    • The case became a leading authority on how far courts can review adjudication determinations under the NSW regime.

  2. What the court had to decide

    • The High Court had to decide whether the NSW security of payment legislation excluded judicial review for non-jurisdictional errors of law on the face of the record in adjudication determinations.

  3. What the court decided

    • The High Court held that the NSW legislation excluded judicial review for non-jurisdictional errors of law on the face of the record.
    • The decision reinforced the fast, interim nature of the security of payment regime.

Practical impact

Practical read

  • Security of payment adjudications are designed to be fast and hard to unwind.
  • Principals and contractors need to raise jurisdictional objections promptly and treat payment schedules as critical documents.

Useful next steps

  • Security of payment determinations can be difficult to challenge for non-jurisdictional legal error.
  • Payment schedules and adjudication responses need rapid legal and factual review.
  • Jurisdictional objections should be identified early, not after the result is bad.
  • Respond to payment claims within the statutory deadline.
  • Put all real reasons for withholding payment in the payment schedule.

Practical read

Probuild is the case that tells construction businesses to take the adjudication process seriously the first time. Security of payment laws are built for speed and cash flow. They are not designed to let every legal error become a long court fight.

For principals, that means payment schedules need real attention. For contractors, it means claims need to be tight and jurisdictionally sound. Both sides should assume deadlines and documents may decide the dispute before anyone gets a leisurely merits review.

Checks to run

Key points

  • Respond to payment claims within the statutory deadline.
  • Put all real reasons for withholding payment in the payment schedule.
  • Check jurisdictional issues before the adjudication response is filed.
  • Do not assume a court can fix every legal error after adjudication.

Key takeaways

  • Security of payment determinations can be difficult to challenge for non-jurisdictional legal error.
  • Payment schedules and adjudication responses need rapid legal and factual review.
  • Jurisdictional objections should be identified early, not after the result is bad.

Related topics

Construction & TradesContracts & Commercial

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