Falgat Constructions v Masterform

Falgat Constructions v Masterform


Supreme Court of New South Wales – 3 August 2005


Falgat Constructions Pty Ltd (‘Falgat’) entered into a construction contract with Masterform to carry out works building works at 23 to 25 Chesterfield Parade, Bronte. A contractual dispute arose and proceedings commenced in the Consumer Trader & Tenancy Tribunal (‘CTTT’). At the same time as these proceedings were on foot, Masterform submitted a Payment Claim under the Building and Construction Industry Security of Payment Act 1999 (NSW) (‘the Act’) for $20,541.49. Falgat, at the time of receiving the claim believed it was simply a statement much the same as previous months statements. Falgat responded, demanding delivery dockets for steel and concrete and did not provide a Payment Schedule under the Act.

Masterform submitted an Adjudication Application under section 17(2) of the Act to the Master Builders Association who awarded the full amount to Masterform. However, Masterform did not provide Falgat with a notice that it intended to apply for Adjudication prior to submitting its Adjudication Application in accordance with section 17(2) of the Act. Section 17(2) provides that if a party intends to apply for adjudication, that party must notify the other of its intention within 20 business days of the due date of the payment and allow a further 5 business days for the provision of a payment schedule before the adjudication application is made to the authorised nominating authority and served on the other party.

Falgat appealed to the Supreme Court contending that the Adjudication Determination was void on the grounds that there was a substantial breach of natural justice due to the failure of Masterform to properly notify Falgat of the Adjudication Application such that Masterform was given no opportunity to file an Adjudication Response.


Whether there had been a breach of natural justice.


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