The first issue of concern before the Deputy Registrar was that the process of adjudication was not properly entered into because the invoices which were the subject of the adjudication did not comply with the requirements of Act.
The Act, states, that pursuant to Division 4, cl 5(2),500 when drafting a claim for payment, the content must be as follows:
(a) be in writing;
(b) be addressed to the party to which the claim is made;
(c) state the name of the claimant;
(d) state the date of the claim;
(e) state the amount claimed;
(f) in the case of a claim by the contractor — itemise and describe the obligations that the contractor has performed and to which the claim relates in sufficient detail for the principal to assess the claim;
(g) in the case of a claim by the principal — describe the basis for the claim in sufficient detail for the contractor to assess the claim;
498 Ibid.
499 Ibid 9 [27].
500 Construction Contracts Act 2004 (WA), Schedule 1, Division 4, clause 4.
119 (h) be signed by the claimant; and
(i) be given to the party to which the claim is made.
The Deputy Registrar stated that:
6 The first ground which is raised is that the process of adjudication was not properly entered into because the invoices which were the subject of the adjudication did not comply with the requirements of Construction Contracts Act because each was not signed, did not specify the date of the claim and did not contain sufficient information to allow the respondent to assess them.501 Division 4, cl 5(2), does state that a claim for payment must be signed by the claimant.
However, State Side was informed by KMC Group to submit payment claims electronically as this had been the previous method of choice. State Side prepared the payment claims and converted the invoices into PDFs. The bundled and PDF’d Invoices that had been agreed to, were sent by email to KMC Group,502 for the deficiencies’.
Neither party was sophisticated enough or had electronic software that would be able to utilise electronic signatures. In the three years that the parties had been ‘doing business amicably,’ it became the standard operating procedure to prepare the invoices and then to PDF the invoices and send them by email to the KMC Group.
Some 985 days earlier, again in the SAT case of Blackadder Scaffolding Services (Aust) Pty Ltd and Mirvac Homes (WA) Pty Ltd,503 Senior Member Raymond and Member Carey established that any payment claim made under a construction contract, ‘is intended to be descriptive only.’504 They surmised:
[t]hat the object of the adjudication is to determine whether the rejection of the payment claim, in whole or in part, is justified. Further, all the legislation intended to convey was that the claim must be one which arises under a construction contract. It is a means to confine adjudication to construction contract claims.505
It had previously been confirmed in Marine & Civil Bauer Joint Venture and Leighton
501 State Side Electrical Services Pty Ltd v WA Commercial Constructions Pty Ltd, [2012] WADC 27, 4 [6].
502 Email State Side, dated 24/08/2011.
503 (2009) WASAT 133.
504 Blackadder Scaffolding Services (Aust) Pty Ltd and Mirvac Homes (WA) Pty Ltd (2009) WASAT 133, 17 [68].
505 Ibid.
120 Kumagai Joint Venture,506 by Senior Member Raymond was that, ‘the emphasis is there on a payment claim for performance of the obligations under the contract, rather than the claim itself.’507
On the 24 April 2012, 54 days after Deputy Registrar Hewitt and three days before Commissioner Gething, made their decisions in both State Side Electrical Services Pty Ltd v WA Commercial Constructions Pty Ltd (and No 2), his Honour Justice McKechnie, in DPD Pty Ltd v McHenry, 508 unreservedly declared that:
28 Attached was, what I regard as a sufficiently itemised claim to describe the obligations that the contractor has performed and to which the claim relates in sufficient detail for the principal to assess the claim. For example:
Claim 1 Claim 2 Tiling – supply $11,820.00 $3,546.00 $8,274.00 Labour wall tiles &
associated $15,083.00 $15,083.00
Labour floor tiles &
screed/water proof $11,432.00 $11,432.00
29 Other items such as practical products, carpentry, demolition/general labour, cabinetmaker, mirrors, plumbing, wallpaper/painters, supervision are also detailed.509
His Honour, went on further to assert:
32 Contrary to the DPD submission, the claims of 17 February 2011 are clearly payment claims within the definition of s 5.510
Had the case gone before his Honour Justice Hall in the WASC in June 2012, as planned, it is likely that his Honour would have had to take the view held by his Honour Justice McKechnie, and this would have been crucial in State Side’s defence.
Secondly, the matter of the electronic signatures could likely have been resolved promptly had
506 Marine & Civil Bauer Joint Venture and Leighton Kumagai Joint Venture [2005] WASAT 269.
507 Blackadder Scaffolding Services (Aust) Pty Ltd and Mirvac Homes (WA) Pty Ltd (2009) WASAT 133, 18 [69]. Senior Member would refer to the comments he made in Marine & Civil Bauer Joint Venture and Leighton Kumagai Joint Venture, [72] – [82].
508 [2012] WASC 140.
509 DPD Pty Ltd v McHenry [2012] WASC 140, 10-11 [28-29].
510 DPD Pty Ltd v McHenry [2012] WASC 140, 11 [32].
121 the Deputy Registrar considered the Electronic Transactions Act 2003 (WA).511
Pursuant to s 3 of the Electronic Transactions Act 2003 (WA), the objective of the Act is to provide a regulatory framework that:512
(a) recognises the importance of the electronic communication of information to the future economic and social prosperity of Western Australia; and
(b) facilitates the use of electronic communication as a way of entering into transactions; and
(c) promotes business and community confidence in the use of electronic communication as a way of entering into transactions; and
(d) enables business and the community to use electronic communication in their dealings with government.
The note at the bottom of Section states:513
(b) that things that can or have to be done under a law of the State in relation to any of the following matters can generally be done by electronic communication — (i) giving information in writing;
(ii) providing a signature;
(iii) producing a document;
(iv) recording information;
(v) retaining a document;
The Electronic Transactions Act 2003 (WA), states at s 9(1), Signatures, that:514
(1) If, under a law of this jurisdiction, the signature of a person is required, that requirement is taken to have been met in relation to an electronic communication if —
511 The Electronic Transactions Act 2003 (WA) and was superseded by the Electronic Transactions Act 2011 (WA). The Electronic Transactions Act 2011 (WA), had gained assent on 25 Oct 2011, but was not yet in operation, though inspection of Version (dated) as at 25 October 2011, whilst published, stated in ‘Provisions that have not come into operation’ footnote 2 - On the date as at which this compilation was prepared, the Electronic Transactions Act 2011 s. 3-7 and Pt. 2-4 had not come into operation. They read as follows, the information awaiting proclamation, including the section pertaining to electronic signatures (s 10).
512 Electronic Transactions Act 2003 (WA) s 3.
513 Ibid [note].
514 Ibid, s 10(1).
122 (a) a method is used to identify the person and to indicate the person’s approval
of the information communicated;
(b) having regard to all the relevant circumstances at the time the method was used, the method was as reliable as was appropriate for the purposes for which the information was communicated; and
(c) the person to whom the signature is required to be given consents to that requirement being met by the use of the method mentioned in paragraph (a).515
To date, in Western Australia, no case has been heard before the Courts pertaining to the Electronic Transactions Act 2003 (WA) issues of section 9 and signatures, and at the time, case law could not have given relief to the Deputy Registrar.
This issue did, however, come before the Full Court of the Supreme Court of South Australia, and later the High Court of Australia, made a judgement in the Corporation of the City of Adelaide v Corneloup & Ors.516 The case was heard by the honourable Corum of Doyle CJ, White J and Kourakis J (as he was then) and was delivered on 10 August 2011 (long before State Side). It was related to an appeal by the Corporation of the City of Adelaide that came about in opposition to a decision that had been attained ‘in the special jurisdiction conferred on the District Court by s 276 of the Local Government Act 1999, declaring invalid, in part, one of its by-laws’.517
The Coram of the Full Court Bench of Chief Justice Doyle, and Justices White, and Kourakis held that:
515 The Electronic Transactions Act 2003 (WA) was repealed in 2011 and replaced by the The Electronic Transactions Act 2011 (WA). The section 9(1) pertaining to signatures was altered to section 10(1), which is as follows:
(1) If, under a law of this jurisdiction, the signature of a person is required, that requirement is taken to have been met in relation to an electronic communication if —
(a) a method is used to identify the person and to indicate the person’s intention in respect of the information communicated; and
(b) the method used was either —
(i) as reliable as appropriate for the purpose for which the electronic communication was generated or communicated, in the light of all the circumstances, including any relevant agreement; or
(ii) proven in fact to have fulfilled the functions described in paragraph (a), by itself or together with further evidence;
and
(c) the person to whom the signature is required to be given consents to that requirement being met by the use of the method mentioned in paragraph (a).
516 [2011] SASCFC 84.
517 Corporation of the City of Adelaide v Corneloup & Ors [2011] SASCFC 84, 1 [3].
123 28. An unsigned certificate was provided by a legal practitioner in electronic
form. The Electronic Transactions Act 2000 (SA) provides that, in prescribed circumstances, an electronic communication may satisfy a requirement in law that a document be signed to be effective. The Judge found that the electronic provision of the certificate did not meet the prescribed circumstances of the Electronic Transactions Act 2000 (SA).518
Pursuant to Division 4, cl 5(2)(h) of the Act, when drafting a claim for payment, the content must be signed by the claimant. The Full Court Bench found that:
29. […] However, in my view, the statutory requirement that the certificate be signed was satisfied by reason of s 9 of the Electronic Transactions Act 2000 (SA). The certificate was provided by an email in circumstances which allowed the identification of the legal practitioner and unequivocally showed that he subscribed to the view expressed in the certificate even though he did not sign it.519
The case would in 2013, after State Side Electrical Services Pty Ltd v WA Commercial Constructions Pty Ltd, go before the High Court of Australia for Appeal, in Attorney-General (SA) v Corporation of the City of Adelaide.520 The strong and honourable Corum of Chief Justice French, and Justices Hayne, Heydon, Crennan, Kiefel and Bell, which would allow the Appeal, confirmed that the email made it clear and evident that the legal practitioner was identified and that he had indeed approved the certificate, despite not having signed it.521 They upheld the view of the Full Court, that ‘provision of the certificate signified that the named legal practitioner held the view that the by-law was valid and subscribed to the opinion required by the certificate albeit that he had not signed it.’522
The Deputy Registrar could have given some consideration to the Full Court of the Supreme Court of South Australia case of the Corporation of the City of Adelaide v Corneloup & Ors.523 In State Side Electrical Services Pty Ltd v WA Commercial Constructions Pty Ltd, the invoices were sent to the KMC Group electronically, and in PDF format, as the accepted modus operandi, throughout the three years that the parties had been ‘doing business amicably.’ The
518 Ibid 7 [28].
519 Ibid 7 [29].
520 [2013] HCA 3 (27 February 2013).
521 Attorney-General (SA) v Corporation of the City of Adelaide [2013] HCA 3, [127].
522 Ibid [194].
523 [2011] SASCFC 84.
124 email address stated ‘State Side Electrical Services, as did the payment claims.
Section 9 of the Electronic Transactions Act 2003 (WA) would have given rise to the indication of the applicant’s intention. It would be reliable as appropriate for the purpose for which the electronic communication was generated, and the respondent to whom the signature is required to be given consents to that requirement being met by the use of the method.
The Deputy Registrar would have been able to consider Electronic Transactions Act 2003 (WA) and the recognition of Section 9, utilise the case study available out of South Australia that could have assisted him in this issue. In 2012, in an age where global commerce and global awareness of environmental consideration is the norm, it is difficult to believe that reliance was still placed on a signature to complete a payment claim.
By 1 August 2012, the Electronic Transactions Act 2011 (WA), had commenced and further strengthened the recognition of electronic transactions within the commercial marketplace. By 27 February 2013, the High Court of Australia had confirmed Attorney-General (SA) v Corporation of the City of Adelaide.524 This proposition would have further strengthened the position taken by his Honour Justice McKechnie, in DPD Pty Ltd v McHenry.525
At the time, that is between 2005 to April 2012, the average number of days for the WASC to deliver a case pertaining to the Construction Contracts Act 2004 (WA), was 49.7 days, with a standard deviation of 67 days.526 It is likely that the earliest day that his Honour Justice Hall could have entered the matter for hearing was the beginning of June 2012’.527 Add 50 days, this could mean that it could have been delivered on 21 July 2012, 10 days before the commencement of the Electronic Transactions Act 2011 (WA). Though this is purely speculative, it is likely that his Honour may have considered the outcome of the South Australian case of the Corporation of the City of Adelaide v Corneloup & Ors.528