The Western Australian Court of Appeal has dismissed CBH's appeal in Co-Operative Bulk Handling Ltd v Martinus Rail Pty Ltd [2026] WASCA 82, confirming that contractual provisions that "deem" when an email is received do not determine when a payment claim is "given" under the Building and Construction Industry (Security of Payment) Act 2021 (WA) (SOPA).
The decision upholds Palmer J's earlier judgment and provides important guidance on the interaction between SOPA, the Electronic Transactions Act 2011 (WA), and contractual notice provisions.
Martinus served a payment claim under SOPA seeking over $22.6 million by email at approximately 4:35pm on Saturday 31 August 2024.
The relevant construction contract contained a notice provision stating that communications received after 5:00pm on a business day, or on a non-business day, were deemed received at 9:00am on the next business day.
CBH did not open the email until Monday 2 September 2024 and subsequently served a payment schedule on 24 September 2024.
Whether that payment schedule was served in time depended entirely upon when the payment claim was taken to have been received.
If the payment claim was received on Saturday 31 August 2024, the 15-business-day period expired on 20 September 2024 and the payment schedule was out of time.
If the contractual deeming provision applied, the payment claim was received on Monday 2 September 2024 and the payment schedule was served on the final day permitted by SOPA.
The appeal focused on regulation 23(d) of the Building and Construction Industry (Security of Payment) Regulations 2022 (WA).
Regulation 23(d) provides that where a document is sent electronically, it is taken to have been given when the electronic communication is taken to be received "in accordance with" section 14 of the Electronic Transactions Act 2011 (WA).
Section 14 relevantly provides that, unless otherwise agreed between the sender and recipient, an electronic communication is received when it becomes capable of being retrieved at the recipient's designated electronic address.
CBH argued that the words "unless otherwise agreed" permitted parties to contractually agree when an electronic communication would be received. Because the contract deemed communications received on a non-business day to be received at 9:00am on the next business day, CBH contended that the SOPA payment claim was received on Monday 2 September 2024.
Martinus argued that regulation 23(d) only incorporates the statutory rules contained in section 14 regarding receipt of electronic communications and does not incorporate contractual agreements that modify those rules.
The Court of Appeal agreed with Martinus.
The Court considered the broader context of regulation 23 and observed that each method of service under the regulations focuses on the point at which a document comes under the recipient's control and the recipient ought to be aware of it.
The Court found that the statutory rules in section 14(1)(a) and (b) of the Electronic Transactions Act are consistent with that objective because they focus on when an electronic communication becomes capable of being retrieved.
By contrast, contractual agreements about when communications are deemed received may produce entirely different outcomes and are not necessarily consistent with the purpose of regulation 23.
A significant aspect of the Court's reasoning was its analysis of the phrase "in accordance with" in regulation 23(d).
The Court held that the phrase requires application of the legal effect of section 14 itself. While section 14 contemplates that parties may agree on different receipt rules, any such agreement derives its legal force from contract rather than from section 14.
Accordingly, regulation 23(d) incorporates the statutory rules contained in section 14(1)(a) and (b), but not any separate contractual agreement concerning receipt.
The Court concluded that the payment claim was given on Saturday 31 August 2024 when it became capable of being retrieved at CBH's nominated email address.
The Court also observed that its interpretation promotes the objectives of SOPA by providing certainty regarding the commencement of statutory time limits and supporting the Act's objective of facilitating the prompt resolution of payment disputes.
Importantly, however, the Court noted that this outcome was driven by the wording of regulation 23 itself. The Court observed (obiter) that there would be nothing inherently problematic with legislation that deemed communications received on the next business day if received outside business hours. The difficulty for CBH was that the regulations currently in force do not adopt that approach.
This decision confirms that:
The decision provides welcome clarity on an issue that had the potential to create uncertainty in the operation of the SOPA regime across different jurisdictions. It reinforces the strict approach adopted by courts when dealing with statutory payment timeframes, and provides welcome clarity for construction companies.
Jackson McDonald's Construction & Infrastructure Team, led by Tom Jacobs together with Michael Stulic, acted for Martinus Rail in both the Supreme Court proceedings and the successful appeal.
For specific legal advice please contact a member of our team.