Aaro Group Pty Ltd v Monadelphous Engineering Associates Pty Ltd [2026] WASC 143

Tom French | Shevaun Stringer | Naoisa McNelis

Key takeouts

Evidence of anything said or done during an adjudication under the Building and Construction Industry (Security of Payment) Act 2021 (WA) (SOP Act) is inadmissible in an application to suspend enforcement of an adjudication determination under section 15 of the Civil Judgments Enforcement Act 2004 (WA) (CJEA), unless both parties consent.

To establish ‘special circumstances’ justifying suspension of an adjudication judgment, the applicant must show it is certain, or almost certain, to suffer irreparable prejudice from a risk that the contractor cannot repay the adjudicated sum. Evidence that the contractor may be unable to satisfy a separate, larger damages claim is not sufficient.

A suspension application under the CJEA engages the merits of the underlying contractual dispute, rather than challenging the validity of the adjudication itself. The evidentiary bar in section 55(4) of the SOP Act therefore applies.

Facts

Aaro Group Pty Ltd (Aaro) obtained two adjudication determinations under the SOP Act against Monadelphous Engineering Associates Pty Ltd (Monadelphous) for approximately $2.58 million (first judgment) and $709,600 (second judgment). Both were filed as judgments in the Supreme Court of Western Australia under section 54(1) of the SOP Act.

On 20 November 2025, a debt appropriation order was made against the National Australia Bank in relation to the first judgment, resulting in a $2 million payment to Aaro. On 9 December 2025, Aaro applied for a further debt appropriation order against Westpac for the remaining balance. On the same day, Monadelphous commenced proceedings against Aaro claiming restitution under section 55(3) of the SOP Act and breach of contract with estimated losses of approximately $18 million (substantive action).

Monadelphous applied under section 15(1) of the CJEA to suspend enforcement of both judgments. It advanced four grounds as special circumstances:

1. Aaro fundamentally failed to perform the work;
2. an administrative error by Monadelphous in the first adjudication prevented it from properly responding;
3. the substantive action for breach of contract far exceeded the judgment debts in value; and
4. there was a genuine risk that Aaro could not satisfy a judgment if Monadelphous succeeded in the substantive action.

Aaro objected to much of Monadelphous’ evidence on the basis that it referred to things said or done during the adjudication, rendering it inadmissible under section 55(4) of the SOP Act. Additional objections were raised on hearsay and opinion grounds.

Decision

Principal Registrar Griffin dismissed the application in its entirety.

On admissibility, the Principal Registrar held that section 55(4) of the SOP Act applied to suspension applications under the CJEA. Evidence of anything said or done during an adjudication was therefore inadmissible unless both parties consented. The Principal Registrar reasoned that a suspension application engages the merits of the underlying dispute, rather than challenging the adjudication determination’s validity. Since Monadelphous was seeking to engage on the merits, the evidentiary bar applied.

The Principal Registrar rejected Monadelphous’ argument that the court’s power to control its own judgments should override section 55(4), accepting that the provision operates as an evidentiary exclusion rule. As a result, the bulk of the evidence was ruled inadmissible.

On special circumstances, the Principal Registrar held that Monadelphous failed to meet the required threshold. The first two grounds largely relied on the inadmissible adjudication evidence, and the remaining admissible material did not demonstrate irreparable prejudice.

As to the third and fourth grounds, the Principal Registrar found that the relevant inquiry was whether Aaro had the capacity to repay the adjudicated sum, not whether it could satisfy the substantially larger $18 million damages claim advanced in the substantive action. The financial evidence adduced by Monadelphous did not address this question, as it failed to demonstrate that Aaro would be unable to repay the smaller adjudicated amounts.

The application was dismissed and Monadelphous was ordered to pay Aaro’s costs of the application.