HALKAT ELECTRICAL CONTRACTORS P/L V HOLMWOOD HOLDINGS P/L  NSWCA 32
Court of Appeal of New South Wales – 28 February 2007
Halkat Electrical Contractors Pty Ltd (“Halkat”) was retained by Holmwood Holdings Pty Ltd (“Holmwood”) as the electrical contractor for a building project. A Payment Claim made by Halkat was referred to adjudication under the Building and Construction Industry Security of Payment Act 1999 (NSW) (“the Act”). The Adjudicator determined that Halkat was entitled to a progress payment from Holmwood of $116,598.35. In determining Halkat’s entitlement, the Adjudicator admitted that he did not have evidence on which he could arrive at a value, but preferred Halkat’s valuation because Holmwood had made unmeritorious submissions elsewhere in its Adjudication Response which reflected on its credibility.
Holmwood brought an application in the Supreme Court to have the determination set aside. The Court found in favour of Holmwood, declaring the determination void on the basis that in preferring one assessment over the other simply because he was more inclined to believe that party, the Adjudicator had acted capriciously and his determination was not made in good faith.
Halkat appealed this decision to the Court of Appeal.
Was the Adjudicator’s determination void on the grounds of lack of good faith?