The New South Wales Court of Appeal has given judgment in Bitannia v Parkline.

In this case, Parkline issued a payment claim on Bitannia. There was no payment schedule in response, and Parkline sought judgment.

In defence, Bitannia alleged that the non-service of payment schedule resulted from misleading conduct by Parkline contrary to the Commonwealth Trade Practices Act.

At first instance, the District Court gave Parkline its judgment.  On appeal, that was overturned; the Court of Appeal said that:

• A breach of the Trade Practices Act can be relied on by way of defence if the alleged misleading conduct affected an essential element of the claim, and
• There was nothing in NSW’s Building and Construction Contracts Security of Payment Act 1999 which precluded such a defence.

The case was sent back to the District Court to consider whether the Trade Practices Act defence could be sustained on the facts.

Basten JA went on to say that, if the State Security of Payment legislation had precluded such a defence, then it would have have been inconsistent with the Commonwealth legislation, and thus inoperative. But since it did not, there was no inconsistency or unconstitutionality.

The Court of Appeal rejected the suggestion that a claim under the SoP legislation can only be made “in good faith”.

See table of cases and the full judgment.