The Supreme Court of Queensland in Azure Project 19 Pty Ltd v 5 Point Projects Pty Ltd [2026] QSC 96 considered whether an adjudicator’s decision under the Building Industry Fairness (Security of Payment) Act 2017 (Qld) (Act) was void on the basis of jurisdictional error.

The dispute arose under a design and construct contract for a luxury residential development. The contractor, 5 Point, made a payment claim for approximately $4 million against the principal, Azure. Azure assessed the payment claim at a lower amount, after setting off approximately $1.13 million in liquidated damages.

5 Point applied for adjudication under the Act and submitted that Azure was entitled to no more than $110,000 in liquidated damages. The parties disagreed on both the contractual deadline (the date for practical completion), and when completion was actually achieved (the date of practical completion).

As to the date for practical completion, the adjudicator was not satisfied that either party established its contended date for practical completion and he did not determine what the date should be. As to the date of practical completion, the adjudicator decided that this was “immaterial” because both parties’ contended dates fell after the “reference date”. The adjudicator’s decision did not explain the significance of the “reference date” to his finding, it was not apparent from the contract terms, and neither party had made submissions on this point. The adjudicator determined 5 Point’s payment claim and set off $110,000 in liquidated damages, being the amount 5 Point had conceded Azure could claim.

Azure challenged the determination, contending there was jurisdictional error because the adjudicator failed to decide the amount of the progress payment as required by the Act. The Court was required to decide whether the adjudicator had made a decision that the Act did not authorise him to make, or failed to make a decision that the Act required him to make.

In finding that the adjudicator made a material jurisdictional error in the application of liquidated damages, the Court found that the adjudicator failed to consider or apply the relevant terms of the contract and failed to give adequate reasons. The Court held that, in treating the date of practical completion as “immaterial”, the basis for calculating $110,000 in liquidated damages was missing from the adjudicator’s reasons.

The part of the adjudicator’s decision setting off $110,000 for liquidated damages was declared void.

The decision can be found here.