Hospital Pass

nrahI am pleased to be able to note a couple more successes in the Supreme Court of South Australia. The first is in Hansen Yuncken Pty Ltd & Anor v Yuanda Australia Pty Ltd & Anor [2018] SASC 158,  a judgment of Justice Lovell on 5 October 2018. I appeared on behalf of Yuanda with Diana Tang of the New South Wales bar as my junior.

It was a rather unusual adjudication challenge arising out of the new Royal Adelaide Hospital (nRAH) project. Responding to a payment claim under the Building and Construction Industry Security of Payment Act 2009 (SA) the HYLC joint venture put some but not all of its cross claim for liquidated damages in issue. In the adjudication, the adjudicator Sean O’Sullivan allowed the cross claim for the amount that had been put in issue, but no more. HYLC then asked the adjudicator to correct his adjudication under the slip rule, to take account of all of its LD claims. Unsurprisingly, the adjudicator refused to do this and HYLC then made an application to the court for judicial review, not of the adjudication decision itself, but of the adjudicator’s refusal to apply the slip rule.

This was a novel approach which failed at every hurdle, the court finding:

  • there was no jurisdictional basis for the challenge;
  • in any event, there was no slip; and
  • the adjudicator had not acted unreasonably.

The second decision was in the same matter. The very next day, Justice Lovell gave an ex tempore judgment dismissing HYLC’s application for a stay pending the results of the arbitration, now afoot, of the underlying disputes. The dismissal of that stay application appears to have been a conventional application of the relevant principles, and in particular an application of the “pay now, argue later” policy of the legislation.

HYLC then made an alternative application for a stay pending appeal. Justice Lovell rejected that application as well, but allowed Continue reading

Under African skies…

FlyerOn 31st July, I will be speaking at a seminar in Johannesburg for AFSA Construction and Society of Construction Law Africa.

The title is “International developments and thoughts on the future for South Africa”. My contribution will be to run through what I have seen as the main features of all available methods for the resolution of construction disputes – all the way from the “gin and tonic” approach whereby disputes are resolved by senior executives over drinks in a hotel bar right through to the “full English breakfast” whereby there is a trial with unlimited time for the parties to prove every one of their contentions in accordance with the rules of evidence.

It will a pleasure to be joined by my Keating Chambers colleague Johan Beyers, who is based in South Africa, who will then relate that international experience to African Continue reading

Murray Colour-Coded

I have now had the opportunity of a further look at the recently released Murray Review, which I briefly mentioned the other day in my post Queen of Hearts – A Good Idea Endorsed.

The Review is a lengthy document, and overall it is a substantial and admirable piece of work. Some of it reaches conclusions that I would not have reached, but I need to be careful here, since it includes quite a bit that I wrote, or which has been redrafted from suggestions that I have made[1], in particular:

  • The phrase “Pay now, argue later”, now widely used around the world to describe the fundamental nature of an excessive adjudication determination (page 82);
  • The Queen of Hearts clause, quoted at page 289 and recommended at Recommendation 84;
  • Several of the extracts from the 2014 SoCLA Report;
  • The “Red card, yellow card” formula to be found in the South Australian Code of Conduct at pages 244 and 245 (Recommendations 67 and 68), which I had originally suggested to Alan Moss for the purpose of the Moss Review;
  • Several of the extracts from SoCLA’s submission to the Murray review, including the recommendation of that system (page 63) and the summation of the June 2017 SocLA event (page 287).

John Murray is an accredited adjudicator in several East Coast jurisdictions, and no doubt one of the very best of them (he is clever, fair and diligent, as well as being good company).  People tend to do what they have done in the past, and to recommend what they know; perhaps it is no surprise that the East Coast model is his preferred starting point for a national system.  An unintended irony lies therein. John Murray includes a revealing graphic about international payment practices on page 14, as follows:[2]

international payment

Australia ranks very porly here. The East Coast model has held most of the field in Australia since its introduction in 1999. It plainly has not worked. And yet John Murray recommends its endorsement, albeit with some useful improvements. Why persist with something which does not work, especially where there are alternatives which do work?  I tried to persuade him to look more closely, not just at security of payment in the region (Australasia and South-East Asia) but the worldwide and particularly UK experiences, but without success – the Review barely mentions the UK or Irish legislative scheme.

Personally, I believe the art of government is best practised with a light hand. The reason I am sceptical of totalitarian solutions – where government imposes rigid Continue reading

Queen of Hearts – A Good Idea Endorsed

The Australian Government has at last released the Report of John Murray Review of Security of Payment Laws – Building Trust and Confidence.

It will take a while to digest this Report – at 407 pages there are inevitably recommendations which are welcome and others which will be less welcome.

QueenAn aspect of the Report that might come as a surprise to some is its treatment of Queen of Hearts clauses.  I posted about this issue last year in a post called Queen of Hearts in the Dock, and discussed it with John Murray. In short, I suggested that it would be a good idea to introduce a statutory benchmark, to more reliably separate reasonable time-barring notice clauses which should be allowed from unreasonable clauses which should not.

John Murray has agreed with me. His commentary in the Report is thus:

Unreasonably onerous time-barring provisions

When conducting a detailed interview with one of the leading lawyers specialising in this field, Mr Fenwick-Elliott, the issue of unreasonably onerous time-barring provision was discussed. Mr Fenwick-Elliott referred me to his website where, under the article Queen of Hearts in the Dock, he sets out the following synopsis of the range of ‘arsenals’ or principles that the courts have developed to relieve a contractor from the harsh consequences of failing to give a required notice: Continue reading

Is there Any Evidence for the Rules of Evidence?

GlassIt has been remarked that it is always a mistake to argue with an idiot: the idiot will drag you down to his own level, where he will beat you on experience.

Something of the same principle applies when we construction lawyers have to litigate a construction dispute before a generalist court with little or no construction or engineering expertise. At its worst, of course, it is a court which might be hearing a criminal case one day, and a construction case the next. And one of the worst features of such a court is a propensity to apply the strict rules of evidence.

A competent and experienced construction tribunal will, for very good reason, ignore pretty much all of the rules of evidence which, in a construction case, have the capacity to waste huge amounts of time and money, and to lead to anomalous results.

What are the rules of evidence? My copy of Cross on Evidence (the 9th Australian edition) runs to 1475 pages, and I am not intending in this post, of course, to attempt to summarise them all. The one that is best known to nonlawyers is probably the rule that the past criminal record of an accused may not be disclosed to a jury. This is an aspect of the similar fact rule, that the prosecution is not permitted to put forward evidence that the accused has a propensity to commit a particular type of crime.[1] Many of them, are highly technical and subject to lengthy and complex exceptions. However, by way of very brief indicative summary, they Continue reading

Goodbye to All That

socla logoAfter several years, I have today[1] stood down as a director of the Society of Construction Law Australia. We have decided to streamline the board, and as part of that process, the directors due to retire by rotation have advanced our departure by a couple of months.

It is a mistake to stay on the board of this sort of organisation for too long, but I will miss that regular contact with friends in the construction law world in the other Australian States.

I notice that my old friend Sir Peter Coulson is also leaving the Technology and Construction Court in London. But he is not going far: he replaces Sir Rupert Jackson as the construction specialist in the English Court of Appeal. He wound up his last judgment in Grove Developments Ltd v S&T (UK) Ltd[2] thus Continue reading