In considering the appeal, the Court’s attention centred on the jurisdiction provided to the adjudicator under s48 of the Act, and enforceability of determinations under sections 58 and 59. Mander J discussed Associate Judge Christiansen’s observation in Van der Wal Builders & Contractors Ltd v Walker,5 that the Act differentiates between determinations as to liability “to make a payment under the relevant construction contract” (s48(1)(a)) and determinations as to “parties rights and obligations under the relevant construction contract” (s48(1)(b)).6 However, Mander J distinguished the present case from Van der Wal. Unlike the circumstances in Van der Wal, CLH relied on specific contractual clauses (clauses 48 and 49), which were terms agreed to by the parties as a mechanism by which certain obligations on Mr Clark, as the owner of the property, would trigger in the event stipulated conditions were established.7
Mander J held that clauses 48 and 49 were terms of the contract on which CLH relied as giving rise to an obligation on Mr Clark to make payment under the contract. Mander J held that such liability arises independently of any common law right of action for breach of contract. CLH’s entitlement to specified items of restitution or indemnification, whether described as payments owing, damages, or expenses, were provided for by the contract itself, and while analogous to damages at common law for breach of contract, the liability for payment was not dependent on proof of breach, but the establishment of the stipulated conditions precedent provided in the relevant contract clauses. Consequently, Mander J concluded that the conditions fell under s48(1)(a) of the Act and payment was enforceable pursuant to s59 by means of the entry of summary judgment as a debt due.
In relation to Mr Clark’s submission that there were matters of significant factual dispute rendering the matter unsuitable for summary judgment, Mander J acknowledged that summary judgment will not normally be appropriate if a case turns on a disputed fact.8 However, Mander J held that the effect of s59 of the Act is to convert the adjudicator’s determination under s48(1)(a) of liability for payment under the contract into an amount recoverable in a Court as a debt due to the successful party. Mander J stated if the findings of the adjudicator were able to be continued to be disputed, the debt would be unenforceable and the purpose of the Act frustrated.9 In reaching his conclusion, Mander J considered that an adjudicator’s determination under s48(1)(a) is binding on the parties and will continue to have full effect notwithstanding a party may have applied for judicial review, or commenced another proceeding relating to the dispute between the parties.10 As such, the determination pursuant to s48(1)(a) remained a debt due, upon which CLH could sue until such time as the adjudicator’s determination is overtaken by a contrary finding on a separate proceeding or judicial review.
Lastly, in reaching his decision to dismiss the appeal, Mander J declined to exercise the Court’s residual discretion to refuse summary judgment. Mander J held that appealing to the Court’s discretion ignored the purpose of the Act in providing a mechanism for payment of disputed amounts, and that Mr Clark was not denied from bringing his own proceeding to seek discovery and have the merits of the contractual dispute finally determined. Such circumstances did not give rise to the rare situation where summary judgment ought not be entered.11
Comment
This is an important decision affirming the jurisdictional powers of adjudicators under the Construction Contracts Act 2002. Mander J confirms the power of adjudicators under s48(1)(a) of