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EDITORS COMMENTS
The annual London conference takes place on
the 19 August 2021 and will be an online
conference with a physical networking and
drinks event in London in the evening at the
Middle Temple. Panel members will have
received an email with the links.
I am also pleased to confirm that the ‘rookie
adjudicator’ has provided another article for
this newsletter which newer adjudicators will
find of interest.
Please do forward articles, events and worthy
news for inclusion in forthcoming newsletters.
If you would like to take part in the conference
as a sponsor, please do let me now.
Our charity partner for the event is the Free
Representation Unit and we are looking for
donations of raffle prizes to assist them with
fundraising at the evening event.
Sean Gibbs LLB(Hons) LLM MICE FCIOB FRICS
FCIARB, is the Chief Executive Officer of
Hanscomb Intercontinental and is available to
sit as an arbitrator, adjudicator, mediator,
quantum expert and dispute board member.
sean.gibbs@hanscombintercontinental.co.uk
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THEATRE ON TELEVISION – ACT
ONE: A PAROLE INSPIRED BY A
PANDEMIC
The pandemic has accelerated the use and
reliance on virtual hearings, but our experience
with these new means is fleeting in
comparison with traditions which have
evolved for hearings in the last 200 years.
Speaking at the UK Adjudicators Edinburgh
2021 Adjudication & Arbitration Conference in
early March, the author opened his
contribution to the panel on ‘the remote
examination of witnesses’ with the remark: the
user’s experience of virtual hearings is in effect
like “watching theatre on television”. He could
not see his audience, only his co-panellists. It
appeared he had won their attention, but what
did he mean by that?
Part of the answer is to reflect on what a stage
is and how we perceive what we see on it is
accepted as reality. Each hearing brings the
expectation of being fairly heard. The Romans
called their place for theatre: Auditorium (from
hearing), but the Greeks who went before
called theirs: Theatron (from seeing).
The distinction of hearing from seeing is
important when it comes to remote hearings,
and the same goes for theatre, as Sybil
Rosenfield pointed out in ‘A History of Scene
Design in Great Britain’: “ … the play is not just
a succession of spoken lines but a pattern built
up of visual and auditory elements”. The
extent that all these elements are transferable
into virtual hearings is debatable, impacting
not only what is seen and heard, but the
advocacy skills required to succeed. Richard Du
Cann in his much cited work ‘The Art of the
Advocate’ illustrates this point through a
memorable quote from his hero Quintilian:
“Advocacy, the highest gift of Providence to
man, needs the assistance of many arts, which,
although they do not reveal or intrude
themselves in actual speaking, supply hidden
forces and make their silent presence felt.”
Inspired by Lee Simonson and Ronald
Harwood, the author’s bachelor dissertation
was written about the Architect and the
Theatre, using four essays to reflect periods of
contemporaneous perceptions and technology
in theatre. It concluded that for theatre itself
to work, it is not that “all the world is a stage”
as Shakespeare taught us, but that “the stage
must be all the world”. The audience must
believe what they see is real. They accept the
reality offered, unconditionally and
unhesitatingly, and that it is, all the world.
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Everything on the stage must be what it
pretends to be. Until this immediate reality is
achieved, no audience can identify itself
sufficiently with the actors to become one with
their emotions and be interested in their
experiences. We are always watching the play,
but beyond a certain point we agree to deceive
ourselves. What matters is that moment when
all the elements of the idea and the set cohere
and become the world of the play. In the
television of video-conferencing, we seek to
capture the ephemeral.
Like the proscenium, itself arguably an
unintentional legacy from the stenographic
limitations in Palladio’s ‘Teatro Olimpico’ in
Vicenza; video-conferencing can be a barrier
questioning our belief and trust in what we
see, separating the actors from their audience,
leaving the audience uncertain of the meaning.
Ronald Harwood, in ‘All the World’s a Stage’
explains why a reply to this quest for meaning
matters: “I am not part of what is going on, I
can recognise others, but what has this to do
with me.” The danger is one of perception by
those who must rely on the hearing of their
dispute to accept the finality of a decision
made through this medium. We must have
trust that what we see is real. The very great
and real tragedy is that our modern world no
longer seems real and so the value we treasure
it as, declines. This very realism, an experience
seen by Prospero, only possible in the present,
is exactly what theatre has preserved in all its
transformations. The periodic transformations
are vital to maintain the reality and to capture
the audience.
The summary given by Ronald Harwood in ‘All
the World’s a Stage’ provides one of the most
poignant descriptions of what our relationship
to theatre means to us, and what we hope to
gain from being part of it. “The theatre
(remains) one of man’s most ingenious
compromises with himself. In it he performs
and entertains, shows off and amuses himself,
and yet it is also one of his most powerful
instruments for exploring and attempting to
understand himself, the world he lives in, and
his place in that world.”
Jan Paulsson highlights a similar dynamic in
‘The Idea of Arbitration’ and in the evolution of
how that idea is perceived and practised.
“There is, in sum, nothing eternal or inevitable
about arbitration: it must find its meaning and
its acceptance in the modern world it purports
to serve. It cannot be static”. Managing
hearings in a pandemic presents a dilemma: on
one side we yearn nostalgically for the past and
all the drama and familiarity of the physical
hearing, on the other we have become awake
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to new possibilities prompting uncertainty of
where our new knowledge leads us in our
perceptions of reality; leaving us as Jim Perrin
rather neatly put it, like ”prisoners on parole
who know they must go back, [but] are unsure
which is captivity, which is release”.
However, as Richard Du Cann highlights in his
book ‘The Art of the Advocate’, the temptation
offered by the analogy to theatre can be
overdone, to the extent that it should be
avoided by the advocate at all costs as this
memorable exchange illustrates: “’I have set
the stage for you Members of the Jury. The
scenery is in place. Let me ring up the curtain
and the play begin’. Defending counsel, in as
aside which rang around the court, asked him:
‘And have your actors learnt their lines?’”
In video-conference, the perfectly honed
perfection of that theatrical experience has
been imprisoned in the transmission through
television by internet. The stage is reduced to
a gallery of heads distorted by fisheye desktop
cameras, views of which are perhaps part-
mitigated by backgrounds of suitably
venerable books. The sudden gasp of the
comprehending but muted audience can no
longer be heard. Like actors in a Chekhov play,
our actors cannot leave their stage or the
illusion is lost. How such transformation came
about is explained by Donald Oenslager in ‘A
History of Stage Design’ through examples
which draw parallels between
contemporaneous perception and practice. In
the first of these, led by the stage designer
Claude Fayette Bragdon, sets may have
appeared bland and static, but these arguably
had enabled another transformation: “The
sophisticated box set had superseded the
traditional system of wings and border”; due in
part to suitably powerful lights. Oenslager then
goes on to explain how the much lesser known
Adolf Wilbrandt went still further still toward
realism, showing a ‘slice of life’ with scenes
which required flat stages because: “in real life
we do not live out our lives on ramped floors.”
Lee Simonson, in ‘The Stage is Set’ reminds us
that the reality and the illusion are inextricably
linked. “The play therefore is a show, always a
show, depending for effectiveness on how
nearly it evokes images, memories and
sentiments, which the audience brings to the
theatre already in their minds. As Walter
Lippmann suggested, ‘for the most part we do
not see, and then define, we define first and
then we see’. The reality of a performance has
no inherent link with realism, it is itself an
illusion, a tacit conspiracy, its illusion the
equivalent of a reality.” In hearings, our trust in
that offered reality is the key.
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Our current perception of virtual hearings is
shaped by parties and tribunals through their
experience in resolving disputes which were
referred before the prolongation of the
pandemic prompted a pragmatic approach.
What remains before us now, is the
opportunity for the paradigm shift in case
management which would be offered by the
television of remote hearings; for the disputes
originating in cognisance of the new
possibilities for case management, and in
absence of any hubris of monopoly over the
means.
About the Author
Iain Aitchison MArch LLM DipICArb FDBF
FCIArb is a Managing Director at Ankura. He is
regularly appointed as an independent expert
on complex and high-value disputes and has
given expert evidence in a virtual hearing in ICC
Arbitration on Delay and FIDIC contract
administration. He is a registered Architect in
Germany and in the UK, and is an accredited
dispute board member, mediator, and
international arbitrator. He is listed on
international arbitration panels, the CIArb
Dispute Board Panel, and with UK
Adjudicators. He sat as arbitrator in 30 virtual
hearings in the Vis Moot 2021 including
chairing in elimination rounds in Vis East Moot
in Hong Kong and Vis Moot in Vienna. His
expert insight and dispute resolution skills
have facilitated the structured settlement of
disputes on a World Bank funded project.
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MY FIRST APPOINTMENT – PART 2
BY THE ROOKIE ADJUDICATOR
Having played the waiting game, the waiting
was over. The Referral and Appendices were
in. Sent by the Referring Party via email and
hard copy to the Responding Party and me.
I wrote to the parties (email and a copy in the
post – still not having time to set up Outlook)
acknowledging receipt of the Referral and
Appendices and set out in the communication
some very important information, this being
the date the Response was to be issued by the
Responding Party (I gave them 7 days) and the
date I was to issue my Decision by.
I now took a back seat and awaited the
Jurisdictional Challenge(s), which often get
issued around about this time in the
adjudication process. To my surprise one did
not arrive, but three days before the Response
was issued I received a communication from
someone new. This someone new was the
Responding Party’s Representative. The
communication came via email and did not
courtesy copy in anyone from the Referring
Party and included email addresses of people,
who were not parties to the dispute. I was
quickly taken back to my mindset of several
days previous, when I had the negative
thought about mischief being made. The Party
Representative had confirmed that he had
received instructions on behalf of his client
(the Responding Party) and looked forward to
hearing from me. I responded with a clear
intention of maintaining control of the process,
firstly I cc’d in the Referring Party and their
Representative. Secondly I removed any
recipient from the email address bar who did
not have an email address for the Responding
Party. Thirdly, I informed the Responding
Party’s Representative that “all
communications issued to myself should be
issued to the Referring Party” and then stated
that only people who are parties to this dispute
should be included in the communication
exchanges. Finally, I provided a copy of my
second communication to the parties. The
Responding Party’s Representative
acknowledged receipt of my emails and as such
I ceased making trips to the local Post Office.
So now I had a Referral Notice and a
Responding Party who were engaging in the
process. This was good, although I was
hesitant about the Response. Would it be
issued? The Responding Party only had three
days left. Would they ask for additional time,
only having three days left? Would the parties
reach a settlement in the three days left?
On the date I had directed, the Responding
party issued a document titled The Response.
It was issued via email and hard copy to both
the Referring Party and me.
This was no conventional Response. The
document actually responded to the Notice of
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Adjudication and not the Referral Notice. This,
as you can imagine did and did not make things
straight forward when it came to
understanding the Responding Party’s
position.
I permitted one further round of submissions
(Reply and Rejoinder) from the Parties and
things were made a little clearer to me,
especially from the Responding Party’s
position and consequently I proceeded to write
my Decision. As I recall from my mind’s eye, I
had the party’s submissions set out across two
tables at my office and I was able to go
between them and get a clear understanding
of what the parties were saying to me. This
may sound peculiar to the reader, but when
you receive several folders of information it is
good to have them organised in a way, which
allows you to quickly locate the piece of
evidence being referred too. I was able to do
this.
The reasoned Decision was issued on day 27,
so within the permitted 28 days with there
being no extension. The Decision was issued in
favour of the Referring Party.
As it is custom for the Adjudicator to issue
his/her invoice at the same time as the
Decision is issued, I did the same and as
directed in my Decision, I had decided that the
Responding Party should pay my fees and pay
them within seven days of the date of the
invoice. Was this a rookie mistake? Should I
have said forthwith? Perhaps, but at the time
I thought seven days to be fair. However on
the eighth day the Responding Party had not
made payment to me so I did what other
adjudicators would do (I hope) and this was to
invoice the Referring Party for the fee, as they
were joint and severally liable. Shortly after
sending the invoice I received an email from
the Referring Party (they had cc’d in the
Responding Party) and informed me that my
invoice would be paid by the Responding Party
later that day. They were not wrong.
So there it was. I had gone full circle. I had been
appointed as adjudicator. I had dealt with
some unexpected procedural issues. I had
received two rounds of submissions from the
parties. I had reached, written and sent my
Decision. I had been paid for what I was asked
to do. I was happy and I believe the Parties
were too; well the Referring Party was.
THE ROOKIE ADJUDICATOR
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A LIMITATION ON THE SECURITY OF
PAYMENTS SECTION 16(4)
JUDGMENT PROCEDURE
Yuanda Vic Pty Ltd v Facade Designs
International Pty Ltd [2021] VSCA 44
Yuanda Vic Pty Ltd v Facade Designs
International Pty Ltd [2021] VSCA 44 (5 March
2021) involved an appeal from a decision of
Riordan J giving judgment in favour of Façade
Designs on a payment claim that included an
amount for interest, which was an excluded
amount.
Façade Designs contracted with Yuanda to
carry out installation of façade elements as
part of the “Arch on Collins” project. It issued a
payment claim for $4.5 million which included
a claim for interest, together with a number of
variations alleged by Yuanda to be non-
claimable variations. In response, Yuanda paid
$1.115 million of the amount claimed, but did
not issue a payment schedule.
The Victorian Building and Construction
Industry Security of Payments Act 2002 (Vic)
(Security of Payments Act) is unique in
including the concept of “excluded amounts”
as amounts that must not be included in a
payment claim. Excluded amounts are defined
in s 10B of the Act, and broadly include claims
for variations that are not “claimable
variations”, compensation for latent
conditions, time-related costs and regulatory
changes, damages for breach of contract, and
other legal claims not based on contract.
There were five grounds of appeal. Yuanda
succeeded on Ground 2, the key issue in the
appeal. The two main issues on appeal were:
whether on an application for judgment
pursuant to s 16 the Court’s role is to assess the
payment claim and attached documentation
on its face to determine if “excluded amounts”
are claimed, or whether the Court should be
involved in “further digging” for that purpose
(Ground 1); and
whether judgment can be entered pursuant to
s 16 on the basis of a payment claim that
includes excluded amounts (Ground 2).
In relation to the second issue, the majority of
McLeish and Niall JJA held that judgment
pursuant to s 16 is given for a “claimed
amount” which is an amount claimed in a
payment claim that does not include an
excluded amount.
Their Honours noted that the Court’s role
pursuant to s 16(2)(a)(i) is to identify and
enforce a statutory liability: [5], [13] and [17].
That liability is to pay the “claimed amount”,
which is defined in s 4 as “an amount of a
progress payment claimed to be due for
construction work carried out, or for related
goods and services supplied, as referred to in
section 14”. Section 14 provides that the
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claimed amount must not include any excluded
amount.
The liability that is to be enforced is that
created under s 15(4), which is for the claimed
amount, nothing less. The natural meaning of
the words “judgment is not to be given” in s
16(4) is that if the claimed amount (to which
the statutory liability attaches) includes any
excluded amount, the court is not to give
judgment: [13], [21]-[22].
By contrast, the role of an adjudicator is to
determine “the adjudicated amount”. Section
23(2A)(a) refers to an adjudicator “not taking
into account an excluded amount”, which is by
way of contrast with the claimed amount
referred to in s 16(4) “not includ(ing) any
excluded amount”: [14]-[15], [30].
Their Honours found that the Act exhibits a
“clear policy” that disputes regarding liability
for payment are to be dealt with by
adjudication, and where there are substantive
issues in dispute about the contents of a
payment claim, the proper course is
adjudication: [18]-[19], [21].
In dissent on this point, Sifris JA found that
Riordan J had been correct in holding that
judgment could be entered for a lesser sum
than the claimed amount stated in the
payment claim. His Honour said that there was
nothing in the Act to indicate that at the time
of judgment, “claimed amount” is not capable
of referring to the amount claimed and actually
owing at that time. The position adopted by
the majority, his Honour noted, “may lead to
absurd and entirely unintended
consequences”, as the case demonstrated in
relation to the claim for interest. His Honour
considered that his interpretation of the Act
was preferable as it promoted the purpose of
the Act: [131], [133]-[134], [136], [138].
Justices McLeish and Niall dismissed the
respondent’s notice of contention that, in the
event Ground 2 were successful, the primary
decision should be upheld as the excluded
amount could be “severed” from the claimed
amount. The doctrine of severance applies
where part of an instrument is preserved by
severance notwithstanding the invalidity of
another part. In this instance, there was no
instrument to which the doctrine could apply.
It did not apply to the payment claim; a
payment claim that includes an excluded
amount is still a valid payment claim albeit that
it cannot be the basis for a judgment under s
16. Their Honours found that none of the cited
authorities supported the respondent’s
reliance on the doctrine of severance. Justice
Sifris, based on his dissenting view on Ground
2, found it unnecessary to consider the
application of the doctrine of severance,
however agreed with the majority that the
doctrine did not apply: [31], [36] and [143].
On the first issue, all three judges agreed that
the question of whether a payment claim
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includes excluded amounts is to be determined
on the face of the payment claim and
documents referred to in it, or served with it,
without a full investigation or “further digging”
to determine the point: [43], [45], [117] and
[120].
Justice Sifris, with McLeish and Niall JJA
agreeing, granted leave but did not uphold
grounds 3 to 5. These grounds related to
alleged errors in the trial judge’s assessment of
whether claims were for excluded amounts,
and whether claims were based on an alleged
fraudulent settlement agreement, which
infected the entire payment claim.
Summary
The Court of Appeal’s decision has significant
consequences for the availability to
contractors of judgment pursuant to s 16
where a payment schedule has not been
issued. Where previously a contractor could
include a range of claims (including potential
excluded amounts) in a payment claim, on the
understanding that judgment could be issued
for a lesser sum if the claimed amount were
found to include an excluded amount, the
majority’s decision in Yuanda means that s 16
offers an “all or nothing” avenue for
contractors. If a payment claim includes
“excluded amounts” then an application for
judgment cannot be made; adjudication is the
only avenue to pursue if a payment schedule
has not been issued. This means that if
contractors wish to have the s 16 avenue
available to them, they must be careful to
ensure that their payment claims do not
include any excluded amounts.
However, the Court’s finding on Ground 1
provides some comfort that the issue of
excluded amounts will not be the subject of a
detailed investigation by the Court. If on the
face of the payment claim and supporting
documents the claim does not include
“excluded amounts” then judgment can be
entered, and the court will not engage in
“further digging” on the basis of a challenge
that the claim includes an excluded amount.
Kylie Weston-Scheuber
The Commercial Bar Association of Victoria
TEL: +61 3 9225 6266
kylie.weston-scheuber@vicbar.com.au
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WA PARLIAMENT PASSES THE
BUILDING AND CONSTRUCTION
INDUSTRY (SECURITY OF PAYMENT)
BILL 2021
The Western Australian Parliament passed the
Building and Construction (Security of
Payment) Bill 2021 (WA) (Bill). Once the Bill
receives Royal Assent and becomes an
operative Act, it will implement sweeping
changes to security of payment laws, bringing
Western Australia more in line with most other
Australian jurisdictions. Most notably, the
Construction Contracts Act 2004 (WA) (CCA)
will no longer apply to new construction
contracts.
History, commencement, and transition
The Bill aims to provide better payment
protections to contractors working in Western
Australia’s construction industry, with a view
to ensuring contractors get paid on time, every
time. It also implements a number of
recommendations from Adjunct Associate
Professor John Fiocco’s report to the
Government on security of payment reform in
Western Australia.
A draft exposure bill was released in June 2020.
A revised version of that bill was passed by the
Legislative Assembly on 10 November 2020 but
lapsed following prorogation of Parliament
prior to the State election.
The reforms have now come sharply back into
focus with the recent collapse of Pindan
triggering calls for the government to take
urgent action to protect subcontractors.
Having been passed by Parliament, the 2021
Bill is now awaiting Royal Assent. Following
Royal Assent, it will become an Act. The
operative provisions of the Act will commence
on dates to be proclaimed by the Western
Australian Government.[1] Different parts of
the Act may commence at different times.
Key changes
The Bill is substantially the same as the bill that
was considered by Parliament in 2020. We
summarise the key areas of reform below.
Progress payments and payment schedules
Parties that carry out or undertake to carry out
construction work, or to supply related goods
and services, will have a statutory right to
receive progress payments and to make a
payment claim every month (or more often if
provided for in the relevant contract). This is
consistent with the position in other states.
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The due dates for payment of progress
payments will vary depending on the parties
involved:
• principal to head contractor: due 20
business days after a payment claim is
made;
• principal to non-head contractor: due
25 business days after a payment claim
is made; and
• contractor to subcontractor: due 25
business days after a payment claim is
made.
For home building work, payment is due on the
date provided for in the contract or, if silent, 10
business days after a payment claim is made
(noting that the Act will not apply to residential
construction contracts for less than $500,000).
If the construction contract provides for a
shorter payment period in any of the above
scenarios, that period will apply.
A party must respond to a payment claim
within 15 business days after the payment
claim is made, unless an earlier time is
provided for by the contract. The payment
schedule must include reasons for not paying a
claimed amount.
Reforming the payment dispute adjudication
process
The adjudication process in this Bill is more
consistent with those in most other Australian
jurisdictions. The provisions are broadly similar
to that of the CCA, with some key differences,
including:
introducing a requirement to provide notice of
intention to apply for an adjudication where a
response to a payment claim is not provided;
shortening the time frame to bring an
adjudication application to 20 business days
following the payment claim and response
procedure (including provision of any notice of
intention to apply for an adjudication); and
providing a new review process.
Consistently with the CCA position:
respondents will have 10 business days to
respond to an application; and
the adjudicator will have 10 business days to
make their determination, unless a longer
period is agreed by the parties (up to a
maximum of 30 business days).
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Regulating certain contract terms
The Bill introduces ‘unfair time bar’ provisions,
providing an arbitrator, adjudicator, court or
expert appointed by the parties with the
power to declare void any notice-based time
bar provision that it deems to be unfair.
‘Pay when paid’ provisions will continue to be
prohibited and have been expanded to include
specific provisions that are contingent or
dependent on the operation of another
contract.
Creating deemed trusts for retention money
This scheme aims to provide security for
builders, contractors, subcontractors and
suppliers if their immediate contractual
counterpart becomes insolvent. Retention
money trust accounts will be required for all
construction contracts that exceed the
prescribed retention money threshold. This
threshold will be prescribed by the regulations
which have yet to be drafted, but the exposure
draft indicated it would be $20,000.
Notably, the Bill does not introduce the
broader cascading statutory deemed trust
regime recommended by John Fiocco. The
broader regime would apply so that, whenever
a party receives payment under a construction
contract on account of work performed by
another party, the payment is deemed to be
held in trust for the benefit of the party who
performed the work. This is intended to
safeguard money owed to subcontractors in
the case of an insolvency by the head
contractor or the principal.
Enhancing the powers of the Building Services
Board
Through amending the Building Services
(Registration) Act 2011 (WA) and the Building
Services (Complaint Resolution and
Administration) Act 2011, the Bill provides the
Building Services Board with enhanced powers
to manage the commercial conduct and
behaviour of registered building services
providers.
Application of the Act
The Bill contemplates a broader application
than the CCA by narrowing the current ‘mining
exception’. When it is operative, the Act will
not apply to:
building contracts with homeowners worth
less than $500,000 (noted above);
contracts between employers and employees
for construction work or related goods and
services;
contracts requiring construction work to be
carried out as a condition of a loan agreement
with a financial institution;
contracts to the extent it forms part of a loan,
guarantee or insurance agreement with a
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financial institution requiring the lending or
repayment of money;
contracts where the consideration payable for
construction works is not monetary
consideration;
contracts for drilling for or extracting minerals,
oil or natural gas;
contracts for constructing a shaft, pit or quarry,
or drilling, for the purposes of discovering or
extracting any mineral or other substance;
contracts to build watercraft; and
contracts involving works where a party fails to
hold a registration in contravention of the
Building Services (Registration) Act 2011.
Key takeaways
Parties should appropriately amend their
precedent contracts so they are ready once the
Act is operative, including to ensure payment
provisions align with the new arrangements.
They should also implement updated policies
and systems within their operations to ensure
compliance with the new legislation.
Corrs Chambers Westgarth -
Spencer Flay, Tom Mathews and
Brianna Dos Santos
WWW.UKADJUDICATORS.CO.UK
JULY 2021 NEWSLETTER
15 | P a g e
UK ADJUDICATORS LONDON
ADJUDICATION & ARBITRATION
CONFERENCE – 19 AUGUST 2021
There is a great line up of speakers
from the United Kingdom, South
Africa and Hong Kong.
Scan the QR code for further
information and to see the
programme.
WWW.UKADJUDICATORS.CO.UK
JULY 2021 NEWSLETTER
16 | P a g e
UK ADJUDICATORS EDINBURGH
ADJUDICATION & ARBITRATION
CONFERENCE – 5 MARCH 2021
The UKA 2021 Edinburgh Adjudication &
Arbitration Conference took place online on
the 5 March 2021 and had over 900
registrations for the free conference. Many
thanks to all of the speakers and supporting
organisations.
The conference video can be viewed at:
https://www.ukadjudicators.co.uk/resources
TCC COURT JUDGEMENTS
May
• Beattie Passive Norse Ltd & Anor v
Canham Consulting Ltd (No. 2
Costs) [2021] EWHC 1414 (TCC) (28
May 2021)
• Dana UK AXLE Ltd v Freudenberg FST
GmbH [2021] EWHC 1413 (TCC) (26
May 2021)
• Davies & Davies Associates Ltd v Steve
Ward Services (UK) Ltd [2021] EWHC
1337 (TCC) (19 May 2021)
• Maypole Dock Ltd v Catalyst Housing
Ltd [2021] EWHC 1742 (TCC) (13 May
2021)
June
• Cartwright Pond Ltd v Wild [2021]
EWHC 1600 (TCC) (11 June 2021)
• The Good Law Project, R (on the
application of) v Minister for the
Cabinet Office & Anor [2021] EWHC
1569 (TCC) (09 June 2021)
• Schenker (Thai) Ltd v Shell Company of
Thailand Ltd [2021] EWHC 1730
(TCC) (24 June 2021)
WWW.UKADJUDICATORS.CO.UK
JULY 2021 NEWSLETTER
17 | P a g e
• Shepherd Construction Ltd v Drax
Power Ltd [2021] EWHC 1478
(TCC) (08 June 2021)
DRBF’S 20TH ANNUAL
INTERNATIONAL CONFERENCE AND
WORKSHOP
30 JUNE - 2 JULY 2021 LISBON,
PORTUGAL
https://www.drb.org/2021-06-lisbon-home-
page
FORTHCOMING EVENTS
Monday, July 5, 2021 - 9:00 AM
BIM in 2021: a look at current and future
trends
Online
Moderator: Rory Kirrane SC, Mason Hayes &
Curran LLP
Speaker(s): May Winfield, Buro Happold;
Ralph Montague, Arcdox & David-John Gibbs,
Gammon Construction
Venue: Online
For more info
Tuesday, July 6, 2021 - 6:30 PM
Factual witness evidence: who needs it? (NLC)
London
Chair: Rowan Planterose, SCA President
Speaker(s): Roger Ter Haar QC and Kim
Franklin QC, Crown Office Chambers
Venue: National Liberal Club, 1 Whitehall Pl,
Westminster, London SW1A 2HE
WWW.UKADJUDICATORS.CO.UK
JULY 2021 NEWSLETTER
18 | P a g e
For more info
Tuesday, July 6, 2021 - 6:30 PM
Factual witness evidence: who needs it?
(Online)
Online
Chair: Rowan Planterose, SCA President
Speaker(s): Roger Ter Haar QC and Kim
Franklin QC, Crown Office Chambers
Venue: Online
For more info
Tuesday, July 13, 2021 - 9:00 AM
An Introduction to Quantum: Part 2
Speaker(s): James Morris (Partner, Mayer
Brown) & Sue Kim (Director, HKA)
For more info
Wednesday, July 28, 2021 - 6:00 PM
EU litigation after Brexit
Chair: Alison Garrett, Mills & Reeve LLP
Speaker(s): Jennifer Jones of Atkin Chambers,
Mathias Cheung and Caroline Greenfield
For more info
Thursday, August 5, 2021 - 5:00 PM
SCL Networking Evening
London
Venue: The Yacht London, Upper Deck, Temple
Pier, Victoria Embankment, London WC2R 2PN
Full details in this flyer
For more info
Tuesday, September 7, 2021 - 9:00 AM
An Introduction to Disruption Claims
Speaker(s): David Coyne (Associate Director,
Blackrock) & Tom Andrews (Senior Associate,
Osborne Clarke)
For more info
WWW.UKADJUDICATORS.CO.UK
JULY 2021 NEWSLETTER
19 | P a g e
SCL INTERNATIONAL CONFERENCE
2021
The Society of Construction Law 9th
International Conference has been postponed
till November 2021. The Right Honourable Lord
Justice Coulson will be a keynote speaker at the
Conference.
http://www.constructionlaw2021.com/scl21

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UK Adjudicators Newsletter July 2021

  • 1. WWW.UKADJUDICATORS.CO.UK JULY 2021 NEWSLETTER 1 | P a g e EDITORS COMMENTS The annual London conference takes place on the 19 August 2021 and will be an online conference with a physical networking and drinks event in London in the evening at the Middle Temple. Panel members will have received an email with the links. I am also pleased to confirm that the ‘rookie adjudicator’ has provided another article for this newsletter which newer adjudicators will find of interest. Please do forward articles, events and worthy news for inclusion in forthcoming newsletters. If you would like to take part in the conference as a sponsor, please do let me now. Our charity partner for the event is the Free Representation Unit and we are looking for donations of raffle prizes to assist them with fundraising at the evening event. Sean Gibbs LLB(Hons) LLM MICE FCIOB FRICS FCIARB, is the Chief Executive Officer of Hanscomb Intercontinental and is available to sit as an arbitrator, adjudicator, mediator, quantum expert and dispute board member. sean.gibbs@hanscombintercontinental.co.uk
  • 2. WWW.UKADJUDICATORS.CO.UK JULY 2021 NEWSLETTER 2 | P a g e THEATRE ON TELEVISION – ACT ONE: A PAROLE INSPIRED BY A PANDEMIC The pandemic has accelerated the use and reliance on virtual hearings, but our experience with these new means is fleeting in comparison with traditions which have evolved for hearings in the last 200 years. Speaking at the UK Adjudicators Edinburgh 2021 Adjudication & Arbitration Conference in early March, the author opened his contribution to the panel on ‘the remote examination of witnesses’ with the remark: the user’s experience of virtual hearings is in effect like “watching theatre on television”. He could not see his audience, only his co-panellists. It appeared he had won their attention, but what did he mean by that? Part of the answer is to reflect on what a stage is and how we perceive what we see on it is accepted as reality. Each hearing brings the expectation of being fairly heard. The Romans called their place for theatre: Auditorium (from hearing), but the Greeks who went before called theirs: Theatron (from seeing). The distinction of hearing from seeing is important when it comes to remote hearings, and the same goes for theatre, as Sybil Rosenfield pointed out in ‘A History of Scene Design in Great Britain’: “ … the play is not just a succession of spoken lines but a pattern built up of visual and auditory elements”. The extent that all these elements are transferable into virtual hearings is debatable, impacting not only what is seen and heard, but the advocacy skills required to succeed. Richard Du Cann in his much cited work ‘The Art of the Advocate’ illustrates this point through a memorable quote from his hero Quintilian: “Advocacy, the highest gift of Providence to man, needs the assistance of many arts, which, although they do not reveal or intrude themselves in actual speaking, supply hidden forces and make their silent presence felt.” Inspired by Lee Simonson and Ronald Harwood, the author’s bachelor dissertation was written about the Architect and the Theatre, using four essays to reflect periods of contemporaneous perceptions and technology in theatre. It concluded that for theatre itself to work, it is not that “all the world is a stage” as Shakespeare taught us, but that “the stage must be all the world”. The audience must believe what they see is real. They accept the reality offered, unconditionally and unhesitatingly, and that it is, all the world.
  • 3. WWW.UKADJUDICATORS.CO.UK JULY 2021 NEWSLETTER 3 | P a g e Everything on the stage must be what it pretends to be. Until this immediate reality is achieved, no audience can identify itself sufficiently with the actors to become one with their emotions and be interested in their experiences. We are always watching the play, but beyond a certain point we agree to deceive ourselves. What matters is that moment when all the elements of the idea and the set cohere and become the world of the play. In the television of video-conferencing, we seek to capture the ephemeral. Like the proscenium, itself arguably an unintentional legacy from the stenographic limitations in Palladio’s ‘Teatro Olimpico’ in Vicenza; video-conferencing can be a barrier questioning our belief and trust in what we see, separating the actors from their audience, leaving the audience uncertain of the meaning. Ronald Harwood, in ‘All the World’s a Stage’ explains why a reply to this quest for meaning matters: “I am not part of what is going on, I can recognise others, but what has this to do with me.” The danger is one of perception by those who must rely on the hearing of their dispute to accept the finality of a decision made through this medium. We must have trust that what we see is real. The very great and real tragedy is that our modern world no longer seems real and so the value we treasure it as, declines. This very realism, an experience seen by Prospero, only possible in the present, is exactly what theatre has preserved in all its transformations. The periodic transformations are vital to maintain the reality and to capture the audience. The summary given by Ronald Harwood in ‘All the World’s a Stage’ provides one of the most poignant descriptions of what our relationship to theatre means to us, and what we hope to gain from being part of it. “The theatre (remains) one of man’s most ingenious compromises with himself. In it he performs and entertains, shows off and amuses himself, and yet it is also one of his most powerful instruments for exploring and attempting to understand himself, the world he lives in, and his place in that world.” Jan Paulsson highlights a similar dynamic in ‘The Idea of Arbitration’ and in the evolution of how that idea is perceived and practised. “There is, in sum, nothing eternal or inevitable about arbitration: it must find its meaning and its acceptance in the modern world it purports to serve. It cannot be static”. Managing hearings in a pandemic presents a dilemma: on one side we yearn nostalgically for the past and all the drama and familiarity of the physical hearing, on the other we have become awake
  • 4. WWW.UKADJUDICATORS.CO.UK JULY 2021 NEWSLETTER 4 | P a g e to new possibilities prompting uncertainty of where our new knowledge leads us in our perceptions of reality; leaving us as Jim Perrin rather neatly put it, like ”prisoners on parole who know they must go back, [but] are unsure which is captivity, which is release”. However, as Richard Du Cann highlights in his book ‘The Art of the Advocate’, the temptation offered by the analogy to theatre can be overdone, to the extent that it should be avoided by the advocate at all costs as this memorable exchange illustrates: “’I have set the stage for you Members of the Jury. The scenery is in place. Let me ring up the curtain and the play begin’. Defending counsel, in as aside which rang around the court, asked him: ‘And have your actors learnt their lines?’” In video-conference, the perfectly honed perfection of that theatrical experience has been imprisoned in the transmission through television by internet. The stage is reduced to a gallery of heads distorted by fisheye desktop cameras, views of which are perhaps part- mitigated by backgrounds of suitably venerable books. The sudden gasp of the comprehending but muted audience can no longer be heard. Like actors in a Chekhov play, our actors cannot leave their stage or the illusion is lost. How such transformation came about is explained by Donald Oenslager in ‘A History of Stage Design’ through examples which draw parallels between contemporaneous perception and practice. In the first of these, led by the stage designer Claude Fayette Bragdon, sets may have appeared bland and static, but these arguably had enabled another transformation: “The sophisticated box set had superseded the traditional system of wings and border”; due in part to suitably powerful lights. Oenslager then goes on to explain how the much lesser known Adolf Wilbrandt went still further still toward realism, showing a ‘slice of life’ with scenes which required flat stages because: “in real life we do not live out our lives on ramped floors.” Lee Simonson, in ‘The Stage is Set’ reminds us that the reality and the illusion are inextricably linked. “The play therefore is a show, always a show, depending for effectiveness on how nearly it evokes images, memories and sentiments, which the audience brings to the theatre already in their minds. As Walter Lippmann suggested, ‘for the most part we do not see, and then define, we define first and then we see’. The reality of a performance has no inherent link with realism, it is itself an illusion, a tacit conspiracy, its illusion the equivalent of a reality.” In hearings, our trust in that offered reality is the key.
  • 5. WWW.UKADJUDICATORS.CO.UK JULY 2021 NEWSLETTER 5 | P a g e Our current perception of virtual hearings is shaped by parties and tribunals through their experience in resolving disputes which were referred before the prolongation of the pandemic prompted a pragmatic approach. What remains before us now, is the opportunity for the paradigm shift in case management which would be offered by the television of remote hearings; for the disputes originating in cognisance of the new possibilities for case management, and in absence of any hubris of monopoly over the means. About the Author Iain Aitchison MArch LLM DipICArb FDBF FCIArb is a Managing Director at Ankura. He is regularly appointed as an independent expert on complex and high-value disputes and has given expert evidence in a virtual hearing in ICC Arbitration on Delay and FIDIC contract administration. He is a registered Architect in Germany and in the UK, and is an accredited dispute board member, mediator, and international arbitrator. He is listed on international arbitration panels, the CIArb Dispute Board Panel, and with UK Adjudicators. He sat as arbitrator in 30 virtual hearings in the Vis Moot 2021 including chairing in elimination rounds in Vis East Moot in Hong Kong and Vis Moot in Vienna. His expert insight and dispute resolution skills have facilitated the structured settlement of disputes on a World Bank funded project.
  • 6. WWW.UKADJUDICATORS.CO.UK JULY 2021 NEWSLETTER 6 | P a g e MY FIRST APPOINTMENT – PART 2 BY THE ROOKIE ADJUDICATOR Having played the waiting game, the waiting was over. The Referral and Appendices were in. Sent by the Referring Party via email and hard copy to the Responding Party and me. I wrote to the parties (email and a copy in the post – still not having time to set up Outlook) acknowledging receipt of the Referral and Appendices and set out in the communication some very important information, this being the date the Response was to be issued by the Responding Party (I gave them 7 days) and the date I was to issue my Decision by. I now took a back seat and awaited the Jurisdictional Challenge(s), which often get issued around about this time in the adjudication process. To my surprise one did not arrive, but three days before the Response was issued I received a communication from someone new. This someone new was the Responding Party’s Representative. The communication came via email and did not courtesy copy in anyone from the Referring Party and included email addresses of people, who were not parties to the dispute. I was quickly taken back to my mindset of several days previous, when I had the negative thought about mischief being made. The Party Representative had confirmed that he had received instructions on behalf of his client (the Responding Party) and looked forward to hearing from me. I responded with a clear intention of maintaining control of the process, firstly I cc’d in the Referring Party and their Representative. Secondly I removed any recipient from the email address bar who did not have an email address for the Responding Party. Thirdly, I informed the Responding Party’s Representative that “all communications issued to myself should be issued to the Referring Party” and then stated that only people who are parties to this dispute should be included in the communication exchanges. Finally, I provided a copy of my second communication to the parties. The Responding Party’s Representative acknowledged receipt of my emails and as such I ceased making trips to the local Post Office. So now I had a Referral Notice and a Responding Party who were engaging in the process. This was good, although I was hesitant about the Response. Would it be issued? The Responding Party only had three days left. Would they ask for additional time, only having three days left? Would the parties reach a settlement in the three days left? On the date I had directed, the Responding party issued a document titled The Response. It was issued via email and hard copy to both the Referring Party and me. This was no conventional Response. The document actually responded to the Notice of
  • 7. WWW.UKADJUDICATORS.CO.UK JULY 2021 NEWSLETTER 7 | P a g e Adjudication and not the Referral Notice. This, as you can imagine did and did not make things straight forward when it came to understanding the Responding Party’s position. I permitted one further round of submissions (Reply and Rejoinder) from the Parties and things were made a little clearer to me, especially from the Responding Party’s position and consequently I proceeded to write my Decision. As I recall from my mind’s eye, I had the party’s submissions set out across two tables at my office and I was able to go between them and get a clear understanding of what the parties were saying to me. This may sound peculiar to the reader, but when you receive several folders of information it is good to have them organised in a way, which allows you to quickly locate the piece of evidence being referred too. I was able to do this. The reasoned Decision was issued on day 27, so within the permitted 28 days with there being no extension. The Decision was issued in favour of the Referring Party. As it is custom for the Adjudicator to issue his/her invoice at the same time as the Decision is issued, I did the same and as directed in my Decision, I had decided that the Responding Party should pay my fees and pay them within seven days of the date of the invoice. Was this a rookie mistake? Should I have said forthwith? Perhaps, but at the time I thought seven days to be fair. However on the eighth day the Responding Party had not made payment to me so I did what other adjudicators would do (I hope) and this was to invoice the Referring Party for the fee, as they were joint and severally liable. Shortly after sending the invoice I received an email from the Referring Party (they had cc’d in the Responding Party) and informed me that my invoice would be paid by the Responding Party later that day. They were not wrong. So there it was. I had gone full circle. I had been appointed as adjudicator. I had dealt with some unexpected procedural issues. I had received two rounds of submissions from the parties. I had reached, written and sent my Decision. I had been paid for what I was asked to do. I was happy and I believe the Parties were too; well the Referring Party was. THE ROOKIE ADJUDICATOR
  • 8. WWW.UKADJUDICATORS.CO.UK JULY 2021 NEWSLETTER 8 | P a g e A LIMITATION ON THE SECURITY OF PAYMENTS SECTION 16(4) JUDGMENT PROCEDURE Yuanda Vic Pty Ltd v Facade Designs International Pty Ltd [2021] VSCA 44 Yuanda Vic Pty Ltd v Facade Designs International Pty Ltd [2021] VSCA 44 (5 March 2021) involved an appeal from a decision of Riordan J giving judgment in favour of Façade Designs on a payment claim that included an amount for interest, which was an excluded amount. Façade Designs contracted with Yuanda to carry out installation of façade elements as part of the “Arch on Collins” project. It issued a payment claim for $4.5 million which included a claim for interest, together with a number of variations alleged by Yuanda to be non- claimable variations. In response, Yuanda paid $1.115 million of the amount claimed, but did not issue a payment schedule. The Victorian Building and Construction Industry Security of Payments Act 2002 (Vic) (Security of Payments Act) is unique in including the concept of “excluded amounts” as amounts that must not be included in a payment claim. Excluded amounts are defined in s 10B of the Act, and broadly include claims for variations that are not “claimable variations”, compensation for latent conditions, time-related costs and regulatory changes, damages for breach of contract, and other legal claims not based on contract. There were five grounds of appeal. Yuanda succeeded on Ground 2, the key issue in the appeal. The two main issues on appeal were: whether on an application for judgment pursuant to s 16 the Court’s role is to assess the payment claim and attached documentation on its face to determine if “excluded amounts” are claimed, or whether the Court should be involved in “further digging” for that purpose (Ground 1); and whether judgment can be entered pursuant to s 16 on the basis of a payment claim that includes excluded amounts (Ground 2). In relation to the second issue, the majority of McLeish and Niall JJA held that judgment pursuant to s 16 is given for a “claimed amount” which is an amount claimed in a payment claim that does not include an excluded amount. Their Honours noted that the Court’s role pursuant to s 16(2)(a)(i) is to identify and enforce a statutory liability: [5], [13] and [17]. That liability is to pay the “claimed amount”, which is defined in s 4 as “an amount of a progress payment claimed to be due for construction work carried out, or for related goods and services supplied, as referred to in section 14”. Section 14 provides that the
  • 9. WWW.UKADJUDICATORS.CO.UK JULY 2021 NEWSLETTER 9 | P a g e claimed amount must not include any excluded amount. The liability that is to be enforced is that created under s 15(4), which is for the claimed amount, nothing less. The natural meaning of the words “judgment is not to be given” in s 16(4) is that if the claimed amount (to which the statutory liability attaches) includes any excluded amount, the court is not to give judgment: [13], [21]-[22]. By contrast, the role of an adjudicator is to determine “the adjudicated amount”. Section 23(2A)(a) refers to an adjudicator “not taking into account an excluded amount”, which is by way of contrast with the claimed amount referred to in s 16(4) “not includ(ing) any excluded amount”: [14]-[15], [30]. Their Honours found that the Act exhibits a “clear policy” that disputes regarding liability for payment are to be dealt with by adjudication, and where there are substantive issues in dispute about the contents of a payment claim, the proper course is adjudication: [18]-[19], [21]. In dissent on this point, Sifris JA found that Riordan J had been correct in holding that judgment could be entered for a lesser sum than the claimed amount stated in the payment claim. His Honour said that there was nothing in the Act to indicate that at the time of judgment, “claimed amount” is not capable of referring to the amount claimed and actually owing at that time. The position adopted by the majority, his Honour noted, “may lead to absurd and entirely unintended consequences”, as the case demonstrated in relation to the claim for interest. His Honour considered that his interpretation of the Act was preferable as it promoted the purpose of the Act: [131], [133]-[134], [136], [138]. Justices McLeish and Niall dismissed the respondent’s notice of contention that, in the event Ground 2 were successful, the primary decision should be upheld as the excluded amount could be “severed” from the claimed amount. The doctrine of severance applies where part of an instrument is preserved by severance notwithstanding the invalidity of another part. In this instance, there was no instrument to which the doctrine could apply. It did not apply to the payment claim; a payment claim that includes an excluded amount is still a valid payment claim albeit that it cannot be the basis for a judgment under s 16. Their Honours found that none of the cited authorities supported the respondent’s reliance on the doctrine of severance. Justice Sifris, based on his dissenting view on Ground 2, found it unnecessary to consider the application of the doctrine of severance, however agreed with the majority that the doctrine did not apply: [31], [36] and [143]. On the first issue, all three judges agreed that the question of whether a payment claim
  • 10. WWW.UKADJUDICATORS.CO.UK JULY 2021 NEWSLETTER 10 | P a g e includes excluded amounts is to be determined on the face of the payment claim and documents referred to in it, or served with it, without a full investigation or “further digging” to determine the point: [43], [45], [117] and [120]. Justice Sifris, with McLeish and Niall JJA agreeing, granted leave but did not uphold grounds 3 to 5. These grounds related to alleged errors in the trial judge’s assessment of whether claims were for excluded amounts, and whether claims were based on an alleged fraudulent settlement agreement, which infected the entire payment claim. Summary The Court of Appeal’s decision has significant consequences for the availability to contractors of judgment pursuant to s 16 where a payment schedule has not been issued. Where previously a contractor could include a range of claims (including potential excluded amounts) in a payment claim, on the understanding that judgment could be issued for a lesser sum if the claimed amount were found to include an excluded amount, the majority’s decision in Yuanda means that s 16 offers an “all or nothing” avenue for contractors. If a payment claim includes “excluded amounts” then an application for judgment cannot be made; adjudication is the only avenue to pursue if a payment schedule has not been issued. This means that if contractors wish to have the s 16 avenue available to them, they must be careful to ensure that their payment claims do not include any excluded amounts. However, the Court’s finding on Ground 1 provides some comfort that the issue of excluded amounts will not be the subject of a detailed investigation by the Court. If on the face of the payment claim and supporting documents the claim does not include “excluded amounts” then judgment can be entered, and the court will not engage in “further digging” on the basis of a challenge that the claim includes an excluded amount. Kylie Weston-Scheuber The Commercial Bar Association of Victoria TEL: +61 3 9225 6266 kylie.weston-scheuber@vicbar.com.au
  • 11. WWW.UKADJUDICATORS.CO.UK JULY 2021 NEWSLETTER 11 | P a g e WA PARLIAMENT PASSES THE BUILDING AND CONSTRUCTION INDUSTRY (SECURITY OF PAYMENT) BILL 2021 The Western Australian Parliament passed the Building and Construction (Security of Payment) Bill 2021 (WA) (Bill). Once the Bill receives Royal Assent and becomes an operative Act, it will implement sweeping changes to security of payment laws, bringing Western Australia more in line with most other Australian jurisdictions. Most notably, the Construction Contracts Act 2004 (WA) (CCA) will no longer apply to new construction contracts. History, commencement, and transition The Bill aims to provide better payment protections to contractors working in Western Australia’s construction industry, with a view to ensuring contractors get paid on time, every time. It also implements a number of recommendations from Adjunct Associate Professor John Fiocco’s report to the Government on security of payment reform in Western Australia. A draft exposure bill was released in June 2020. A revised version of that bill was passed by the Legislative Assembly on 10 November 2020 but lapsed following prorogation of Parliament prior to the State election. The reforms have now come sharply back into focus with the recent collapse of Pindan triggering calls for the government to take urgent action to protect subcontractors. Having been passed by Parliament, the 2021 Bill is now awaiting Royal Assent. Following Royal Assent, it will become an Act. The operative provisions of the Act will commence on dates to be proclaimed by the Western Australian Government.[1] Different parts of the Act may commence at different times. Key changes The Bill is substantially the same as the bill that was considered by Parliament in 2020. We summarise the key areas of reform below. Progress payments and payment schedules Parties that carry out or undertake to carry out construction work, or to supply related goods and services, will have a statutory right to receive progress payments and to make a payment claim every month (or more often if provided for in the relevant contract). This is consistent with the position in other states.
  • 12. WWW.UKADJUDICATORS.CO.UK JULY 2021 NEWSLETTER 12 | P a g e The due dates for payment of progress payments will vary depending on the parties involved: • principal to head contractor: due 20 business days after a payment claim is made; • principal to non-head contractor: due 25 business days after a payment claim is made; and • contractor to subcontractor: due 25 business days after a payment claim is made. For home building work, payment is due on the date provided for in the contract or, if silent, 10 business days after a payment claim is made (noting that the Act will not apply to residential construction contracts for less than $500,000). If the construction contract provides for a shorter payment period in any of the above scenarios, that period will apply. A party must respond to a payment claim within 15 business days after the payment claim is made, unless an earlier time is provided for by the contract. The payment schedule must include reasons for not paying a claimed amount. Reforming the payment dispute adjudication process The adjudication process in this Bill is more consistent with those in most other Australian jurisdictions. The provisions are broadly similar to that of the CCA, with some key differences, including: introducing a requirement to provide notice of intention to apply for an adjudication where a response to a payment claim is not provided; shortening the time frame to bring an adjudication application to 20 business days following the payment claim and response procedure (including provision of any notice of intention to apply for an adjudication); and providing a new review process. Consistently with the CCA position: respondents will have 10 business days to respond to an application; and the adjudicator will have 10 business days to make their determination, unless a longer period is agreed by the parties (up to a maximum of 30 business days).
  • 13. WWW.UKADJUDICATORS.CO.UK JULY 2021 NEWSLETTER 13 | P a g e Regulating certain contract terms The Bill introduces ‘unfair time bar’ provisions, providing an arbitrator, adjudicator, court or expert appointed by the parties with the power to declare void any notice-based time bar provision that it deems to be unfair. ‘Pay when paid’ provisions will continue to be prohibited and have been expanded to include specific provisions that are contingent or dependent on the operation of another contract. Creating deemed trusts for retention money This scheme aims to provide security for builders, contractors, subcontractors and suppliers if their immediate contractual counterpart becomes insolvent. Retention money trust accounts will be required for all construction contracts that exceed the prescribed retention money threshold. This threshold will be prescribed by the regulations which have yet to be drafted, but the exposure draft indicated it would be $20,000. Notably, the Bill does not introduce the broader cascading statutory deemed trust regime recommended by John Fiocco. The broader regime would apply so that, whenever a party receives payment under a construction contract on account of work performed by another party, the payment is deemed to be held in trust for the benefit of the party who performed the work. This is intended to safeguard money owed to subcontractors in the case of an insolvency by the head contractor or the principal. Enhancing the powers of the Building Services Board Through amending the Building Services (Registration) Act 2011 (WA) and the Building Services (Complaint Resolution and Administration) Act 2011, the Bill provides the Building Services Board with enhanced powers to manage the commercial conduct and behaviour of registered building services providers. Application of the Act The Bill contemplates a broader application than the CCA by narrowing the current ‘mining exception’. When it is operative, the Act will not apply to: building contracts with homeowners worth less than $500,000 (noted above); contracts between employers and employees for construction work or related goods and services; contracts requiring construction work to be carried out as a condition of a loan agreement with a financial institution; contracts to the extent it forms part of a loan, guarantee or insurance agreement with a
  • 14. WWW.UKADJUDICATORS.CO.UK JULY 2021 NEWSLETTER 14 | P a g e financial institution requiring the lending or repayment of money; contracts where the consideration payable for construction works is not monetary consideration; contracts for drilling for or extracting minerals, oil or natural gas; contracts for constructing a shaft, pit or quarry, or drilling, for the purposes of discovering or extracting any mineral or other substance; contracts to build watercraft; and contracts involving works where a party fails to hold a registration in contravention of the Building Services (Registration) Act 2011. Key takeaways Parties should appropriately amend their precedent contracts so they are ready once the Act is operative, including to ensure payment provisions align with the new arrangements. They should also implement updated policies and systems within their operations to ensure compliance with the new legislation. Corrs Chambers Westgarth - Spencer Flay, Tom Mathews and Brianna Dos Santos
  • 15. WWW.UKADJUDICATORS.CO.UK JULY 2021 NEWSLETTER 15 | P a g e UK ADJUDICATORS LONDON ADJUDICATION & ARBITRATION CONFERENCE – 19 AUGUST 2021 There is a great line up of speakers from the United Kingdom, South Africa and Hong Kong. Scan the QR code for further information and to see the programme.
  • 16. WWW.UKADJUDICATORS.CO.UK JULY 2021 NEWSLETTER 16 | P a g e UK ADJUDICATORS EDINBURGH ADJUDICATION & ARBITRATION CONFERENCE – 5 MARCH 2021 The UKA 2021 Edinburgh Adjudication & Arbitration Conference took place online on the 5 March 2021 and had over 900 registrations for the free conference. Many thanks to all of the speakers and supporting organisations. The conference video can be viewed at: https://www.ukadjudicators.co.uk/resources TCC COURT JUDGEMENTS May • Beattie Passive Norse Ltd & Anor v Canham Consulting Ltd (No. 2 Costs) [2021] EWHC 1414 (TCC) (28 May 2021) • Dana UK AXLE Ltd v Freudenberg FST GmbH [2021] EWHC 1413 (TCC) (26 May 2021) • Davies & Davies Associates Ltd v Steve Ward Services (UK) Ltd [2021] EWHC 1337 (TCC) (19 May 2021) • Maypole Dock Ltd v Catalyst Housing Ltd [2021] EWHC 1742 (TCC) (13 May 2021) June • Cartwright Pond Ltd v Wild [2021] EWHC 1600 (TCC) (11 June 2021) • The Good Law Project, R (on the application of) v Minister for the Cabinet Office & Anor [2021] EWHC 1569 (TCC) (09 June 2021) • Schenker (Thai) Ltd v Shell Company of Thailand Ltd [2021] EWHC 1730 (TCC) (24 June 2021)
  • 17. WWW.UKADJUDICATORS.CO.UK JULY 2021 NEWSLETTER 17 | P a g e • Shepherd Construction Ltd v Drax Power Ltd [2021] EWHC 1478 (TCC) (08 June 2021) DRBF’S 20TH ANNUAL INTERNATIONAL CONFERENCE AND WORKSHOP 30 JUNE - 2 JULY 2021 LISBON, PORTUGAL https://www.drb.org/2021-06-lisbon-home- page FORTHCOMING EVENTS Monday, July 5, 2021 - 9:00 AM BIM in 2021: a look at current and future trends Online Moderator: Rory Kirrane SC, Mason Hayes & Curran LLP Speaker(s): May Winfield, Buro Happold; Ralph Montague, Arcdox & David-John Gibbs, Gammon Construction Venue: Online For more info Tuesday, July 6, 2021 - 6:30 PM Factual witness evidence: who needs it? (NLC) London Chair: Rowan Planterose, SCA President Speaker(s): Roger Ter Haar QC and Kim Franklin QC, Crown Office Chambers Venue: National Liberal Club, 1 Whitehall Pl, Westminster, London SW1A 2HE
  • 18. WWW.UKADJUDICATORS.CO.UK JULY 2021 NEWSLETTER 18 | P a g e For more info Tuesday, July 6, 2021 - 6:30 PM Factual witness evidence: who needs it? (Online) Online Chair: Rowan Planterose, SCA President Speaker(s): Roger Ter Haar QC and Kim Franklin QC, Crown Office Chambers Venue: Online For more info Tuesday, July 13, 2021 - 9:00 AM An Introduction to Quantum: Part 2 Speaker(s): James Morris (Partner, Mayer Brown) & Sue Kim (Director, HKA) For more info Wednesday, July 28, 2021 - 6:00 PM EU litigation after Brexit Chair: Alison Garrett, Mills & Reeve LLP Speaker(s): Jennifer Jones of Atkin Chambers, Mathias Cheung and Caroline Greenfield For more info Thursday, August 5, 2021 - 5:00 PM SCL Networking Evening London Venue: The Yacht London, Upper Deck, Temple Pier, Victoria Embankment, London WC2R 2PN Full details in this flyer For more info Tuesday, September 7, 2021 - 9:00 AM An Introduction to Disruption Claims Speaker(s): David Coyne (Associate Director, Blackrock) & Tom Andrews (Senior Associate, Osborne Clarke) For more info
  • 19. WWW.UKADJUDICATORS.CO.UK JULY 2021 NEWSLETTER 19 | P a g e SCL INTERNATIONAL CONFERENCE 2021 The Society of Construction Law 9th International Conference has been postponed till November 2021. The Right Honourable Lord Justice Coulson will be a keynote speaker at the Conference. http://www.constructionlaw2021.com/scl21