Supreme Court of New South Wales – 5 July 2005


Tolfab Engineering Pty Ltd (‘Tolfab’) entered into a sub-contract arrangement with Tie Fabrications Pty Ltd (‘Tie’) for metalwork for a residential development known as the “Oxford Square Project” located on the corner of Oxford Street and Pelican Street Oxford. Tie served a Payment Claim under the Building and Construction Industry Security of Payment Act 1999 (NSW) (‘the Act’) claiming $351,270.48 for work done under the Contract. Tolfab responded with a Payment Schedule under the Act. The Payment Schedule included a table which provided a description of the works, job value, claimed to date, claimed previous, approved this claim and outstanding claim. This was a formula the parties had used in previous progress claims.

Tie lodged an Adjudication Application addressing many of the claims in detail. In answer, Tolfab launched into a substantial amount of detail in its Adjudication Response. The Adjudicator determined the Adjudication in favour of Tie,  determining that the full amount of the Payment Claim should be paid. The Adjudicator in his Adjudication Determination referred to the fact that the matters of dispute in the Adjudication Response were not dealt with in the Payment Schedule and therefore he could not consider them in his Adjudication Determination under section 20(2B) of the Act.

Tolfab, in these proceedings, contended that the Adjudication Determination was void on the grounds that the Adjudicator failed to take into account the facts and submissions contained in its Adjudication Response which constitutes a breach of the rules of natural justice.


Was the formula used in the Payment Schedule sufficient to allow Tolfab to rely on further reasons in its Adjudication Response?


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