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ARTICLE · 24 JULY 2016

SSC Plenty Road Pty Ltd V Construction Engineering (Aust) Pty Ltd [2016] VSCA 119

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Mediation is not a "method of resolving disputes" under the the Building and Construction Industry Security of Payment Act.

AustraliaReal Estate and Construction
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KEYWORDS: CLAIMABLE VARIATIONS; SECURITY OF PAYMENT

KEY TAKEAWAY

The Court of Appeal has confirmed that mediation is not a "method of resolving disputes" for the purpose of section 10A(3)(d)(ii) of the Building and Construction Industry Security of Payment Act 2002 (Vic).

Parties wishing to limit variations that can be included in a payment claim should specify arbitration (or potentially binding expert determination) in the dispute resolution clause.

Facts

The decision at first instance was the subject of a detailed note in an earlier Construction Law Update. In summary, the dispute resolution clauses in the construction contract between the parties provided for a compulsory meeting between the parties, followed by mandatory mediation. This clause was relevant to the "claimable variations" regime under Victorian security of payment legislation.

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