A major NSW court decision—Builtcom Construction Pty Ltd v VSD Investments Pty Lt—highlights how Security of Payment disputes can escalate into full-blown litigation. But the rules aren’t the same across Australia. Here’s how NSW compares to Victoria—and what it means for your business.
Case Snapshot: Builtcom v VSD [2025] NSWSC 250
- VSD terminated its contract with Builtcom on a 30-storey project.
- Builtcom made a final claim under NSW’s Security of Payment Act (SOPA) and was awarded $8.5M.
- Both sides challenged the decision, but the court dismissed their claims—confirming that only jurisdictional errors can overturn an adjudication in NSW.
Fund Release and Stay Application
- In a follow-up case, VSD was ordered to release over $8.7M to Builtcom.
- The NSW Court of Appeal refused to delay the payment—reinforcing that SOPA’s purpose is to keep money flowing to contractors, even while part of a decision is under appeal.
Upcoming Appeal: What’s Still at Stake
An unresolved issue is whether the adjudicator’s refusal to assess 12 claims (under the Cardno principles) was a jurisdictional error. This will be argued on 23 May 2025 and could shape:
- What “refusal to exercise jurisdiction” means under SOPA;
- How adjudicators apply Cardno when valuing claims;
- Whether courts can send part of an adjudication back for reconsideration.
Comparative Analysis: Victoria vs New South Wales
The rules around adjudication challenges vary between states—and that affects how secure your payment rights really are:
| Victoria | New South Wales | |
| Grounds for Judicial Review | Jurisdictional errors and errors of law on the face of the record | Jurisdictional errors only |
| Court’s Supervisory Power | Constitutionally protected (s.85 of Constitution Act 1975) | Not constitutionally entrenched |
| Likelihood of Challenges | Higher, due to broader review grounds | Lower, due to strict review limits |
| Impact on Adjudication | More uncertainty; decisions easier to overturn | Greater stability; decisions harder to challenge |
In Victoria, broader review rights mean adjudicators’ decisions are more likely to be tested in court—leading to more legal risk and delays. In NSW, decisions are more stable and enforceable, supporting SOPA’s “pay now, argue later” approach.
Why This Matters to You
For builders and subcontractors in both VIC and NSW:
- Know your rights under your state’s SOPA.
- Prepare payment claims carefully—there’s little room to fix errors later.
- Understand the risk of litigation and how your state’s laws affect cash flow certainty.
Need help with a payment claim or adjudication?
Our team advises clients across VIC and NSW. Reply to this email or reach out today for clear, practical guidance.
