In Gulf Civil Pty Ltd v K & F Group Pty Ltd [2026] QSC 221, the Supreme Court of Queensland considered whether there was a ‘construction contract’ for the purpose of section 64 of the Building Industry Fairness (Security of Payment) Act 2017 (Qld) (the ‘Act’). This case confirms the broad application of security of payment legislation and the availability of adjudication to arrangements that are not common law contracts.

Gulf and K & F were initially related entities. K & F hired equipment to Gulf and Gulf undertook construction works. The parties subsequently entered into a Hire Agreement in 2022 reflecting this arrangement.

The Hire Agreement contained an entire agreement clause which contemplated that further Agreement Particulars would be executed each time K & F hired equipment to Gulf. The parties never executed any further Agreement Particulars. The Hire Agreement stipulated the duration of the Agreement as ‘ongoing until return of machinery’ and listed 22 items of equipment with corresponding hire rates.

Haribol Civil Pty Ltd subsequently acquired Gulf in August 2025. Gulf continued its existing projects and ultimately returned all of K & F’s equipment in December 2025.

A dispute arose regarding Gulf’s liability for hire charges. K & F issued a payment claim comprising plant hire charges and associated repair and maintenance costs. Gulf responded with a payment schedule assessing K & F’s entitlement as nil. K & F applied for adjudication under the Act and the adjudicator determined it was entitled to approximately 30% of its payment claim.

Gulf subsequently applied to the Supreme Court of Queensland seeking to have the adjudicator’s determination declared void for want of jurisdiction, contending there was no ‘construction contract’ for the purpose of section 64 of the Act. Specifically, Gulf relied on the entire agreement clause to characterise the Hire Agreement as a framework agreement under which further Agreement Particulars were to be executed each time an item was rehired. It further argued that the Hire Agreement had ceased for items which had been returned and remobilised, such that further Agreement Particulars were required.

K & F argued that the Hire Agreement was a ‘construction contract’ under the Act, asserting that it was an agreement for the supply of equipment for defined rates on an ongoing basis until the return of all the machinery.

The Court dismissed Gulf’s application, holding that the Hire Agreement was a ‘construction contract’. In reaching this decision, Crowley J held that a reasonable businessperson would have understood the Hire Agreement to provide for a continuing rolling arrangement under which the identified machinery would be hired for either uninterrupted or intermittent periods and the overall agreement continuing until the last item of machinery was returned.  The alternative interpretation would create a commercially impractical situation whereby equipment could not be remobilised until new Agreement Particulars were executed.

The Court also considered correspondence from Gulf’s solicitors which acknowledged that the Hire Agreement continued to govern the parties’ arrangements.  Significantly, the Court held that, even if the original agreement was no longer operative, the parties’ dealings were capable of constituting an ‘other arrangement’ within the broad statutory definition of a ‘construction contract’ because there was a concluded, bilateral state of affairs for the supply of equipment, which Gulf accepted.

The decision highlights the broad application of security of payment legislation to agreements beyond common law contracts, and to plant hire arrangements.  The absence of a newly executed hire agreement for each deployment will not necessarily prevent an arrangement from constituting a ‘construction contract’, particularly where the parties’ conduct and communications demonstrate an ongoing arrangement.

The decision can be viewed here.