In brief

The case of McCarthy v TKM Builders Pty Ltd & Anor [2020] QSC 301 concerned an application by McCarthy (Applicant) to the Supreme Court of Queensland in relation to whether TKM Builders Pty Ltd (Respondent) had properly served on the Applicant supporting submissions to the Respondent's adjudication application for an adjudication under the Building Industry Fairness (Security of Payment) Act 2017 (BIF Act). 

The Respondent attempted to serve on the Applicant an adjudication application in relation to a dispute regarding progress payments connected with a construction contract for a building project at Bells Creek. 

The Respondent sent the adjudication application to the Applicant via an email with the adjudication application attached to the email and the supporting submissions accessible through a Dropbox link contained in the text of the email. The Applicant did not open the Dropbox link and argued that the supporting submissions were not served in accordance with the BIF Act.

The Court considered the provisions of the BIF Act and the Acts Interpretation Act 1954 (AIA) and concluded that the adjudication application had not been served. 

Service requirements

The Court firstly considered the relevant law. The BIF Act sets out the regime for the adjudication of disputed progress payment claims and section 79 required that a copy of the adjudication application be given to the Applicant. 

The BIF Act states in section 102 that service of a notice, which includes the giving of an adjudication application, may be by the following:

  • in accordance with the way, if any, stated in the relevant construction contract; or

  • in accordance with the methods stated in the AIA. 

The AIA states in section 39 that a document may be served on an individual by the following:

  • delivering it to the person personally; or

  • by leaving it at, or by sending it by post, telex, facsimile or similar facility to, the address of the place of residence or business of the person. 

How was the adjudication application given to the Applicant?

The Respondent sent an email to the Applicant, which relevantly included the following terms (at [7]): 

Please find below link to correspondence and attached adjudication claim lodged with the QBCC today.

https://www.dropbox.com/sh/jt7427ejjhz70ik/AACVuiCVC1Ug2YG6X27CFBuca?dl=0

Whilst the email attached a copy of the adjudication application to the email, the supporting submissions, which adjoined the adjudication application, were only accessible via the Dropbox link.

The Respondent argued that an inference ought to be drawn from the Applicant's evidence that the Applicant's solicitors accessed the Dropbox link for the purpose of preparing a response to the adjudication application. 

The Applicant argued that the Court ought follow the decision of Conveyor & General Engineering Pty Ltd v Basetec Services Pty Ltd [2015] 1 Qd R 265; [2014] QSC 30 (Basetec Decision) in which the Supreme Court of Queensland considered the now repealed Building and Construction Industry Payments Act 2004 (BCIP Act). The Court noted that the BCIP Act was the predecessor to the BIF Act and that there was no relevant difference between the sections of the BCIP Act and BIF Act that deal with the requirement to give an adjudication application. 

The Court in the Basetec Decision determined that under the BCIP Act the supporting submissions form part of the adjudication application and must be served as part of, and therefore in accordance with, the service requirements for the adjudication application. The Court noted that the Basetec Decision concluded that "a document will be served if the efforts of a person who is required to serve it have resulted in the person to be served becoming aware of the contents of the document" (at [20]). 

Having considered the Basetec Decision, and the methods of service stated in section 39 of the AIA, the Court stated that the Applicant had not become aware of the contents of the supporting submissions merely by being referred to a Dropbox link. Therefore, the Court held that the supporting submissions were not served in accordance with section 39 of the AIA or section 79 of the BIF Act. 

Jurisdiction of the Adjudicator

In the adjudication following the Applicant's receipt of the adjudication application, the Adjudicator held that he had the relevant jurisdiction to determine the matter as it had been demonstrated that the Applicant was in possession of the adjudication application and the supporting submissions.

The Adjudicator went further and stated as follows (quoted at [11]):

"Notwithstanding the statutory provisions in respect to the service of documents under the BIF Act and other legislation, the fact is that it has been demonstrated that the respondent was in possession of a copy of the adjudication application and its supporting submissions. If a document has been received by the other party, the manner in which it was served is unlikely to matter."

However, the Court concluded that the statutory time period prescribed in the BIF Act for making a decision in respect of the adjudication application did not commence, and the Adjudicator, therefore, did not have the necessary jurisdiction to make a decision. 

Conclusion

The Court, following the Basetec Decision, held that the Applicant had not become aware of the contents of the supporting submissions provided by the Dropbox link and that therefore the Respondent had not served the adjudication application on the Applicant in accordance with section 39 of the AIA or section 79 of the BIF Act. As the adjudication application had not been validly served on the Applicant, the Adjudicator did not have the relevant jurisdiction to make a decision in relation to the progress payment dispute the subject of the adjudication application.

While the case of McCarthy v TKM Builders Pty Ltd & Anor [2020] QSC 301 concerned service under the BIF and AIA, the author notes that service under the Planning and Environment Court Act 2016 and the Planning and Environment Court Rules 2018 is generally in accordance with chapter 4 (service) of the Uniform Civil Procedure Rules 1999 rather than section 39 of the AIA. However, in particular circumstances service under the Planning Act 2016 may be in accordance with Part 4A (service of documents) of the Planning Act 2016, which states that a person may serve a document on the receiver by:

  • giving the receiver another document stating that the relevant document can be viewed on a stated website or other electronic medium; or

  • where the receiver has provided an electronic address for service, by sending to the electronic address a notice stating the relevant document can be viewed by opening a stated hyperlink.

This is commentary published by Colin Biggers & Paisley for general information purposes only. This should not be relied on as specific advice. You should seek your own legal and other advice for any question, or for any specific situation or proposal, before making any final decision. The content also is subject to change. A person listed may not be admitted as a lawyer in all States and Territories. © Colin Biggers & Paisley, Australia 2021.

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