Cooper & Oxley Group Pty Ltd v Koitka: clarity is key

In the recent case of Cooper & Oxley Group Pty Ltd v Koitka[1]the Supreme Court of Western Australia delivered its first decision regarding a judicial review (JR) application in respect of an adjudicator’s determination made pursuant to the Building and Construction Industry (Security of Payment) Act 2021 (WA) (SOPA).

The case serves to remind parties to clearly set out their claims and position in payment claims and schedules, and confirms that the Court has no intention of departing from the well-established and widely applied principles governing judicial review of adjudication determinations made under security of payment legislation.

Background

The head contractor (Cooper & Oxley) engaged a subcontractor (Caledonia) to carry out works at a golf course. Disputes arose between the parties concerning Caledonia's work, and the sufficiency of the supporting material that Caledonia provided for the nine progress claims Caledonia submitted.

Caledonia suspended its work, following which Cooper & Oxley terminated the subcontract, relying on a termination for convenience clause. After the subcontract was terminated, Caledonia submitted progress claim 10, claiming $223,726.84.[2] The progress claim was not submitted as a ‘final’ claim.[3] In a letter to Caledonia, Cooper & Oxley disputed the validity of the progress claim but, as a precautionary measure, also gave a payment schedule, which included a payment certificate and a spreadsheet assessing the progress claim.[4]

Relying on the termination, Cooper & Oxley assessed the progress claim as if it were a ‘final’ claim. It did so in an unusual way; by assessing Caledonia’s works as 100% complete, valuing the completed works, and then applying a credit for the value of the original scope of work which remained to be completed.[5] It then applied further deductions and set offs for alleged defects and outstanding debts, all of which resulted in the claim being valued at negative $543.85.[6] Relevantly;

1. Cooper & Oxley’s payment schedule and adjudication response contained very limited references to the clauses of the subcontract which attempted to limit Caledonia’s post-termination rights to payment, and to entitle Cooper & Oxley to set off against amounts claimed by Caledonia.[7

    

2. The spreadsheet that formed part of the payment schedule:

   1. did not set out how much Cooper & Oxley considered it had already paid to Caledonia;[8] and

       

   2. identified backcharges, defect rectification costs and outstanding debts, but only claimed the rectification costs and debts as a set off, and did not deduct the backcharges from the amounts assessed as payable to Caledonia.[9]

The adjudicator found that the progress claim was valid, and that it was not a final claim.[10] He held that because it was not a final claim, the way in which Cooper & Oxley had assessed the claim (certifying the work as complete then applying deductions for unfinished scope work) was improper.[11] His determination included a table summarising the parties’ respective positions, which did not refer to amounts Cooper & Oxley said it had paid, or to any backcharges[12] and he held that Cooper & Oxley should pay Caledonia $131,935.76.[13]

Cooper & Oxley applied for judicial review of the decision on the basis that it considered the adjudicator had failed to perform his function under s38(1)(a) of the SOPA (which requires an adjudicator to determine amount of the progress payment, if any, to be paid by the respondent to the claimant) because the determination: 

1. failed to consider that, pursuant to the construction contract, Caledonia had limited contractual entitlements to payment following a termination for convenience, and Cooper & Oxley was entitled to apply set offs, including for potential claims (Ground 1); and

    

2. failed to have any, or any proper, regard to Cooper & Oxley's entitlement to set off in respect of backcharges, debts due and set offs (Ground 1).

Ground 1 

The  Court found that the adjudicator had accepted that he needed to take into account Cooper & Oxley’s set offs, and amounts it contended had already been paid, to the extent these matters had been raised by Cooper & Oxley.[14] The Court identified four examples of the adjudicator having expressly referred to set off rights[15] and stated that there was no jurisdictional error simply because the adjudicator did not refer specifically to cl 17.10 (right to set off) or cl 36.8 (termination for convenience) of the subcontract.[16] 

The Court further held that the adjudicator’s statement that “[Cooper & Oxley] does not have the right to make deductions for unfinished scope work in relation to this claim” did not mean that Cooper & Oxley was not entitled to claim set offs for ‘potential claims’ pursuant to clause 17.10. That statement was made in the context of the adjudicator’s decision that progress claim 10 was not a ‘final claim’, and that Cooper & Oxley’s method of assessing it as if it was a final claim was wrong. In any event:

1. if the adjudicator had taken the position that Cooper & Oxley did not have a contractual entitlement to set off ‘potential claims’, this would have amounted to an error of law in construing the contract, and not to a reviewable jurisdictional error;[17] and

    

2. Cooper & Oxley's adjudication response submissions did not suggest that its set offs were for ‘potential’ claims or address how cl 17.10 should be applied to ‘potential’ claims it may have.

There was no failure by the adjudicator to perform his functions in respect of the matters raised by Ground 1 because he accepted that he was required to take into account, and he actually did take into account, the previous payments and set offs to the extent they were asserted by Cooper & Oxley, regardless of whether the contract was terminated.[18]

Ground 2

Cooper & Oxley argued that the adjudicator failed to have any, or any proper, regard to specific set offs raised in the payment schedule and adjudication response submissions in respect of:

1. backcharges ($48,420.16);

    

2. defect remediation ($3,415.90); and

    

3. outstanding debts due ( $10,407.96).

Defect Rectification

The court held that there had been no jurisdictional error in relation to Cooper & Oxley’s set offs for defect rectification. A misunderstanding, if any, of the relationship between the reasons for set offs given by Cooper & Oxley in the payment schedule and the detail contained in its adjudication response would not amount to a jurisdictional error[19] and it was evident from the references to submissions and supporting documents included in the adjudicator’s reasons that he had considered and interrogated the documents provided by Cooper & Oxley.[20] The court was not willing to infer that the regard given to those documents was insufficient simply because the adjudicator had rejected the claims. 

Backcharges and Debts due 

However, the Court held that there had been jurisdictional errors made in respect of Cooper & Oxley’s attempts to set off backcharges and debts due. In this regard, the Court held that:

1. It was not immediately clear on the face of the spreadsheet included in the payment schedule that Cooper & Oxley intended to set off the backcharges identified.[21]  However,  in the context of Cooper & Oxley’s adjudication response submissions and supporting statutory declaration, the Court was satisfied that Cooper & Oxley had maintained its claim to set off the backcharges. The absence of the backcharges in the adjudicator’s summary table in the determination, and the absence of any other findings in respect of the backcharges claimed, conveyed that the adjudicator did not appreciate it was necessary to consider them, and the Court found that he did not do so. Correspondingly, the Court held that there had been a jurisdictional error because the adjudicator failed to consider a material matter raised by Cooper & Oxley in response to the progress claim.

    

2. The adjudicator’s finding that he could find no reason in the payment schedule to support Cooper & Oxley’s set off for a debt due to it was “inexplicable” on the basis that the set off claim was included in the payment schedule spreadsheet under the heading “OUTSTANDING DEBTS DUE - PROGRESS CLAIMS” and clearly referenced that an outstanding debt from progress claim 9 was the basis for the set off.[22] Lemonis J noted that, had the adjudicator’s reasons indicated he had considered the documents comprising progress claim 9 and could find no evidence to support the set off of the debt, it may have given rise to an error of fact, rather than law. However, where payment schedule 9 was before the adjudicator, and the determination merely stated that he was not able to find any reason in the payment schedule for the deduction, the court was willing to infer that he had not had regard to whether progress claim 9 supported the claimed set-off, and had therefore made a reviewable error of law. 

Key takeaways

In the context of the well-developed body of case law surrounding judicial review of administrative and quasi-judicial decision making, the decision in Cooper & Oxley v Koitka is not surprising or unusual. 

However, as the first reported decision on a JR application pursuant to the SOPA, Cooper & Oxley v Koitka is important. It reinforces a number of principles which have previously been widely applied in both Western Australia, in respect of the Construction Contracts (Former Provisions) Act 2004, and in the east, in respect of the various states’ SOPA equivalent legislation, namely;

1. The decision of an adjudicator is only subject to judicial review in respect of jurisdictional errors of law[23] – determinations are not reviewable merely because an adjudicator has misunderstood or misapplied the relevant construction contract.[24]

    

2. Reviewable jurisdictional errors are those which affect the adjudicator’s exercise of power,[25] such as misapprehending or disregarding the nature or limits of the adjudicator's functions or powers, failing to take into account a consideration that the statute requires be considered, or taking into account a consideration required to be ignored.[26] An ‘error’ is unlikely to amount to a jurisdictional error if:
   1. the adjudicator has arrived at their determination having followed a process of considering the provisions of the relevant act and construction contract, and those submissions that they believe to have been duly made;[27] or  

   2. the error relates to a matter which is so minor that it has no impact on the outcome of the determination.[28]

       

3. An error of fact alone is not a reviewable error. However, if the nature of the factual error supports an inference that a jurisdictional error has also occurred, there may be a reviewable error of fact and law.[29]

    

4. The absence of a reference a particular matter or thing does not necessarily support an inference that a jurisdictional error has occurred - there are a range of possible explanations for an adjudicator’s failure to reference a particular matter or thing.[30]

The decision in Cooper & Oxley v Koitka also stands to remind parties of the need for clarity in payment claims, payment schedules, and adjudication submissions. Lemonis J’s final observation demonstrates that this is a matter the Court is keen for construction industry participants and their legal representatives to address:

“The [SOPA] envisages that the procedures relating to progress claims are carried out expeditiously, efficiently and fairly, recognising that a progress claim is an interim claim. To achieve these objectives, the parties to a progress claim need to make sure their position in respect of the claim is clearly expressed. Doing so significantly reduces the need for, and scope of, proceedings such as these, and the legal costs associated with them. It is also important to bear in mind that clarity is usually achieved by the use of plain language.”

This article was written by  Briony Whyte,  Senior Associate Construction.
 
 

[1]  [2026] WASC 4, (Cooper & Oxley v Koitka)

[2] Cooper & Oxley v Koitka, [10].

[3] Cooper & Oxley v Koitka, [82].

[4] Cooper & Oxley v Koitka, [55].

[5] Cooper & Oxley v Koitka, [74].

[6] Cooper & Oxley v Koitka, [10].

[7] Cooper & Oxley v Koitka, [68]-[69].

[8] Cooper & Oxley v Koitka, [77], [115]-[129].

[9] Cooper & Oxley v Koitka, [78].

[10] Cooper & Oxley v Koitka, [80], [82].

[11] Cooper & Oxley v Koitka, [84].

[12] Cooper & Oxley v Koitka, [85].

[13] Cooper & Oxley v Koitka, [12].

[14] Cooper & Oxley v Koitka, [94], [99].

[15] Cooper & Oxley’s argument in respect of Caledonia’s entitlements after termination for convenience became largely irrelevant once it accepted that its interpretation of cl 36.8(b) of the Subcontract would have the effect of modifying or excluding Caledonia’s SOPA rights, and was probably unenforceable pursuant to s 111 of the Building and Construction Industry (Security of Payment) Act 2021 (WA). Although not required to decide the issue, in obiter Lemonis J indicated he agreed with this view – see [103].

[16] Cooper & Oxley v Koitka, [94]-[98].

[17] Cooper & Oxley v Koitka, [100].

[18] Cooper & Oxley v Koitka, [109].

[19] Cooper & Oxley v Koitka, [158].

[20] Cooper & Oxley v Koitka, [150]-[158], .

[21] Cooper & Oxley v Koitka, [136]-[137].

[22] Cooper & Oxley v Koitka, [159]-[163].

[23] Cooper & Oxley v Koitka, [41]-[42], citing Perrinepod Pty Ltd v Georgiou Building Pty Ltd [2011] WASCA 217 and Probuild Constructions (Aust) Pty Ltd v Shade Systems Pty Ltd [2018] HCA 4.

[24]  Cooper & Oxley v Koitka, [44], citing Total Eden Pty Ltd v Charteris [2018] WASC 60 (Total Eden). See also Acciona Agua Australia Pty Ltd v Monadelphous Engineering Pty Ltd (2020) QR 410, [35] (Acciona Agua).

[25] Cooper & Oxley v Koitka, [43], citing Minister for Immigration and Multicultural Affairs v Yusuf [2001] HCA 30.

[26] Cooper & Oxley v Koitka, [45]-[46] citing Total Eden. See also Ceerose Pty Ltd v A-Civil Aust Pty Ltd (2023) 112 NSWLR 225, [75]-[77].

[27] Acciona Agua, [36]

[28] [47]. See also Ceerose Pty Ltd v A-Civil Aust Pty Ltd (2023) 112 NSWLR 225, [52].

[29] Cooper & Oxley v Koitka, [48].

[30] [92] and [158], citing Martinus Rail Pty Ltd v Qube RE Services (No 2) Pty Ltd [2025] NSWCA 49. See also Ceerose Pty Ltd v A-Civil Aust Pty Ltd (2023) 112 NSWLR 225, [62]-[66].