BuildLaw Issue 35 April 2019 | Page 19

In Davenport Stuart-Smith J noted that the Court in Harding did not make a “clear and unequivocal statement” on whether a defendant may commence proceedings before paying (pay attention to the quoted comment, as we will return to it later!). It seems likely that the Court did not make a definitive statement on this issue in Harding as the defendant had paid the amount owing by the time the case was heard.
In analysing Harding, Stuart-Smith J said that the Court of Appeal decision implied that it is not an “essential prerequisite” to relying upon a later true value adjudication decision that the earlier immediate obligation should be discharged before launching the later true value adjudication. He went on to say that this suggests that the critical time is at enforcement of the obligation (not the commencement of further adjudication). Therefore, on this approach, a defendant may be restrained if they have not paid amounts owing when the Courts are deciding whether to enforce the obligation.
Interim vs final payment context
Whilst the relevant claims in Harding and Davenport were final claims, the relevant claim in Grove was a progress claim. Stuart-Smith J noted that there was no “good or substantial reason” to treat applications based on interim and final payment claims differently as the same principles apply to interim and final payments throughout the HGCRA; immediate payment is the priority in order to protect cashflow.
This principle will easily transfer to a New Zealand context. The purposes of the CCA are designed to protect cashflow through facilitation of regular and timely payments. This purpose and Lord Denning’s infamous statement on cashflow as the “lifeblood of the enterprise” are particularly important in New Zealand now given the current climate where many contractors appear insolvent. Of some importance, unlike the HGCRA the CCA provides no distinction between interim and final payment claims. Any distinction at an adjudication or enforcement stage would therefore likely be meaningless.