The Supreme Court of New South Wales has ruled on how a monetary threshold in an expert determination clause should be read. The decision, Built Pty Ltd v State of New South Wales [2026] NSWSC 1147, was delivered by Rees J and summarised by Clayton Utz in a construction bulletin dated 3 November 2026.
The clause allowed the parties to refer "an Issue" to an expert. It barred court proceedings on the matters the expert decided, unless the determination required one party to pay the other more than $500,000. The law firm describes it as a GC21 expert determination clause.
The question was whether the $500,000 figure is tested against the combined result of all issues referred, or against each issue separately. The court held that it applies to each issue separately. In its reasoning, the court said that a cumulative test would let parties bundle all their disputes together. That would defeat the purpose of the threshold, which is to filter out minor disputes.
Why it matters
Expert determination is often used to resolve technical or valuation disputes quickly and keep them out of court. A monetary threshold decides when a party may still litigate. Under this ruling, how a dispute is divided into issues can affect whether the threshold is reached. Owners and contractors should therefore draft referrals with care, and should check how their own contract defines an "Issue" and sets any threshold. The decision comes from one Australian court and concerns one clause wording, so its weight elsewhere depends on the contract and the governing law.
What it means for e-bonH clients
Clear dispute-resolution wording, and well-structured notices and referrals, are part of sound contract administration. Teams that manage entitlement and disputes can use claim management services to organise claims into distinct issues, keep the supporting records, and understand the contract's thresholds before a referral is made.
This summary was prepared with AI assistance from the sources above and published automatically by e-bonH. Please refer to the original sources for full details.