Kellogg Brown & Root v Doric Contractors; Determination as judgment

In Kellogg Brown & Root Pty Ltd v Doric Contractors Pty Ltd [2014] WASC 206, the unsuccessful respondent to an adjudication determination managed to set aside a statutory demand issued pursuant to the determination because the claimant had not first “converted” the determination into a judgement.  This case was under the WA Act, which requires leave of the Court to enforce a determination.  In SA, an adjudication determination can simply be registered as a judgment debt without an intervening hearing.

The demand was set aside pursuant to both the ‘some other reason’ provision in the Corporations Act and the Court’s residual jurisdiction to set aside on the basis of an abuse of process.

The Court held that a demand based on an adjudication result could not be set aside on the alternative ground there was a ‘genuine dispute’ as to the merits, because the legislation required payment regardless of the merits.  However, the Court held it could be set aside if there was a ‘genuine dispute’ about its validity because of the existence of a judicial review application (which in this case there was, simultaneously on foot).

This case reinforces that without following the correct procedure, an adjudication determination does not in itself form a debt that can be enforced by statutory demand, even though the legislation expressly requires payment of an adjudicated amount.

You can read the judgment in full here.

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