CPB Contractors Pty Ltd & Ors v MSS Projects (NSW) Pty Ltd t/as MSS Steel & Ors [2025] QSC 239

Julie Whitehead | Ren Shike | Ada Harvey

Key takeout

Whether a payment schedule complies with the requirements in section 69(c) of the Building Industry Fairness (Security of Payment) Act 2017 (BIF Act) is a jurisdictional fact.  If an adjudicator fails to properly assess and determine a jurisdictional fact, that may render an adjudication decision void on grounds of jurisdictional error.

A valid payment schedule must clearly articulate the respondent’s reasons for withholding payment, however, there is no particular way in which a respondent must state its reasons. The required level of detail is assessed only by whether it sufficiently apprises the claimant of the basis for objection and adequately defines the parameters of the dispute.

Facts

Background

CPB Contractors Pty Ltd, BAM International Australia Pty Ltd, Ghella Pty Ltd and UGL Engineering Pty Ltd were the parties to an unincorporated joint venture (Joint Venture), engaged to undertake underground construction work for the Cross River Rail Project (Project).

In May 2023, the Joint Venture subcontracted with MSS Projects (NSW) Pty Ltd (MSS Steel) for the supply of steel.

In August 2024, MSS Steel issued a payment claim under the BIF Act for $2,557,707.59 (Payment Claim).  The Joint Venture issued its payment schedule, certifying only $227,925.58 as payable (Payment Schedule).

Adjudication

In August 2024, MSS Steel lodged an adjudication application under section 79 of the BIF Act.  The Joint Venture subsequently lodged its adjudication response. The adjudicator determined that the Payment Schedule did not comply with section 69(c) of the BIF Act, in that it did not adequately provide reasons for withholding payment from MSS Steel (Adjudication Decision).  This decision triggered the Joint Venture’s liability to pay the full amount claimed plus interest and fees.

Decision

The Joint Venture brought an application before the Supreme Court of Queensland seeking an order that the Adjudication Decision be set aside or declared void on the grounds of jurisdictional error.

The central issue raised in the proceeding was whether the Payment Schedule was a valid payment schedule under the BIF Act.

Johnstone J. granted the application, finding that the Payment Schedule met the requirements of section 69(c) of the BIF Act. The Court was satisfied that the Payment Schedule sufficiently apprised MSS Steel of the basis for the Joint Venture’s objections to the amounts specified in the Payment Claim and adequately defined the parameters of the dispute because:

• the response clearly stated objections to the claimed sum and proposed reduced payment amounts with sufficient reasoning; and
• the Joint Venture adequately explained its calculation methodology for the variations claimed and its reasons for adopting that approach.

Given that the payment schedule was valid, the Court found the adjudicator’s finding that it was invalid constituted an error in the determination of jurisdictional fact, rendering the Adjudication Decision void.

The Court confirmed that whether a payment schedule provided in response to a payment claim is a payment schedule for the purposes of the BIF Act is a jurisdictional fact, and an error in the determination of a jurisdictional fact is a jurisdictional error.