In Romeciti Macquarie Pavillion Pty Ltd v Watpac Construction Pty Ltd [2026] NSWSC 404, Nixon J dismissed proceedings seeking to set aside an adjudication determination awarding Watpac $9.2m for encashed security under a D&C contract.
In May 2019 Romeciti and Watpac entered into a D&C contract for the Natura mixed use development in Macquarie Park. Watpac provided security in the form of an undertaking and a bond each for $3.75m. Construction commenced in September 2019. The strata plan was registered in February 2022. In October 2022 Watpac served a payment claim for $13.3m. Romeciti issued a payment schedule for -$5.7m. Adjudication awarded Watpac $5.7m. Romeciti then converted the undertaking and bond to $7.5m cash. A dispute arose which was settled via Deed in July 2025. The Deed provided for payment to Watpac and mutual releases. In January 2026 Watpac served a payment claim for $9.2m which included $7.5m for the encashed security plus interest. Romeciti issued a nil payment schedule. Adjudication awarded Watpac the entire $9.2m. In March 2026 Romeciti commenced proceedings to set aside the determination. His Honour dismissed the proceedings.
Romeciti argued the adjudicator failed to consider the Payment Claim and supporting submissions as required by s 22(2)(c). It argued the adjudicator failed to perform the statutory task by proceeding on the basis that the payment claim did not depend on the Deed. His Honour disagreed. Interpreting a payment claim is a matter for the adjudicator and an error in interpreting is not jurisdictional. What an adjudicator is required to consider is the payment claim as interpreted by the adjudicator, and any errors in the interpretation are errors within jurisdiction. In this case the adjudicator plainly did consider the payment claim. The complaint was really that the adjudicator misunderstood the payment claim or its basis, but any such error was not jurisdictional.
Romeciti contended the claim was not for a "progress payment" under the construction contract but was based on the Deed which fell outside SOPA's jurisdiction. It said Watpac asserted an entitlement under the Deed. His Honour disagreed. SOPA does not require the payment claim assert any entitlement to a progress payment under the contract. S 13 is permissive in its terms and does not restrict s 8. While it is uncontroversial that a progress payment cannot claim amounts recoverable under the general law as damages or restitution, it is not the case that a claim properly characterised as such would make it invalid because that would imply an essential precondition inconsistent with the SOPA. It is sufficient the claimant is a person who claims to be entitled to a progress payment.
His Honour also dismissed as non-jurisdictional Romeciti's claim the adjudicator erred by treating certain case law (eg EnerMech) as establishing that any claim for encashed security is valid under SOPA without determining if it arose under the construction contract.