Final Payment Claim Can Include Retention Monies - J.G. King Project Management Pty Ltd v Hunters Green Retirement Living Pty Ltd [2024] VSCA 310

Latest
15 Dec, 2024 1234

The Victorian Court of Appeal Finds That a Final Payment Claim Made Pursuant to the Building and Construction Industry Security of Payment Act 2002 (Vic) Can Include Retention Monies

In the recent Court of Appeal decision of J.G. King Project Management Pty Ltd v Hunters Green Retirement Living Pty Ltd [2024] VSCA 310 handed down on 12 December 2024, their honours Niall, Kennedy and Macaulay JJA found that a final claim could include retention monies as it was still characterised as money owing for construction work done.

The matter involved an application for the judicial review of two adjudication determinations made under s 23 of the Building and Construction Industry Security of Payment Act 2002. The determinations related to the construction of Stages 12 and 13 of a retirement village in Cranbourne East under AS4902 building contracts.

In summary, the adjudicator (the second respondent) held that the first respondent developer (principal) was liable to pay to the applicant (builder) an amount equal to the payments retained by it under the contracts less an adjustment in relation to certain claimed items.

Attiwill J in determining the judicial review applications in first instance held that the final payment claims were not payable until the final certificates were provided and clauses 37.4 and 5.4 of the building contracts were satisfied.

Niall, Kennedy and Macaulay JJA found there was no error in the adjudication determinations that held that the claims were due and payable.

At [44] Niall JA concluded:

“In my opinion, it does not matter that the money the subject of the claims could also be characterised as money held by the principal as security. Even if it was held for that purpose, it did not lose its character as money owing for construction work done. It may be accepted that a claim for the release of other forms of security may not involve a claim for payment for construction work. So, for example, if the builder had provided a bank guarantee in the sum of 10 per cent of the contract price to be held as security, a claim for its release would not be a claim to be paid for construction work. That is a very different situation to a claim based on money withheld by the principal that was otherwise payable for work done.”

(03) 9088 2106
eric@brixtonlegal.com.au
LinkedIn