With reference to Downer EDI Works Pty Ltd v Steensma [2022] WASC 396
During any adjudication, a set-off issued before a payment claim shall not form part of a payment dispute unless either it’s the subject of the payment claim, or it is stated in the rejection response of the payment claim.
This was held in the Downer EDI Works Pty Ltd v Steensma [2022] WASC 396 case heard by the Supreme Court of Western Australia.
During the adjudication hearing, the adjudicator rejected Downer’s set-off claim, even though it neither formed part of the payment claim subjected to the adjudication nor was stated in their rejection of Steensma’s payment claim.
The Supreme Court decided the case in favour of Downer and held that the adjudicator did not have jurisdiction to determine Downer’s set-off claim and had fallen into jurisdictional error by doing so.
I trust that a similar principle will apply to other dispute resolution methods like arbitrations. arbitrators shall resolve only the dispute referred to them.
Adjudication – adjudication is a contractual and statutory means of dispute resolution used largely in the construction industry in countries like Australia and the UK.
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