Construction update — Australia: Diploma Construction (WA) Pty Ltd v KPA Architects Pty Ltd [2014] WASCA 91

The Western Australia (WA) Court of Appeal has upheld a contractor’s right to enforce, by statutory demand, a judgment obtained following the adjudication of a payment claim under the Construction Contracts Act 2004 (WA).

On 24 April 2014, the WA Court of Appeal confirmed that the statutory demand process is available to enforce a determination and a judgment obtained following the adjudication of a payment claim under the Construction Contracts Act 2004 (WA). The court also clarified the law around the bases upon which statutory demands may be set aside by the court pursuant to the Corporations Act 2001 (Cth).

It is now clear that a statutory demand will not be set aside simply on the basis of a contention that a genuine dispute exists as to the debt, if that debt is based on a determination or judgment obtained under the act. Likewise, only a genuine offsetting claim, sounding in money, with sufficient evidence to establish its existence, will be capable of reducing or setting aside a statutory demand…

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