A Queensland court stayed an adjudication award the builder was unlikely to repay

“Pay now, argue later” is the security of payment bargain: the respondent pays the adjudicated amount immediately and recovers any overpayment after final determination. The bargain has a known failure mode: what if, by the time you win the final argument, the claimant has no money to repay? Taringa Property Group Pty Ltd v Kenik Pty Ltd[2024] QSC 327 gives one Queensland answer to that question: the court stayed enforcement of a $4,218,787.02 adjudication award because of the claimant's perilous financial position, even though the claimant was not yet in liquidation. The sequel proved the point: the claimant was wound up two months later.

Taringa Property Group engaged Kenik under a design-and-construct contract (August 2020, roughly $13.6 million) for a retail development at Taringa in Brisbane. After Taringa terminated the contract on 29 August 2023, Kenik served a payment claim of about $9.7 million; Taringa's payment schedule responded nil. In February 2024 an adjudicator awarded Kenik $4,218,787.02, and the adjudication certificate was filed as a judgment. Taringa paid the amount (with interest and costs) into court and applied on two fronts: to set the determination aside for jurisdictional error, which failed, and for a stay of enforcement pending its substantive proceeding claiming overpayment and damages.

The stay evidence was the heart of it. Kenik had about $9,000 cash at bank. Its claimed net current assets rested on around $2 million of disputed receivables. It carried nearly $7 million in liabilities, many of them long-overdue trade debts on projects completed years ago, its QBCC licence had been suspended for failing minimum financial requirements and later surrendered, it had stopped trading, its director was personally funding it, and a creditor's winding-up application was already on foot. Hindman J's assessment was blunt: it was difficult to see a path that did not end in external administration.

Queensland authority (the R J Neller Building Pty Ltd v Ainsworth [2008] QCA 397 line) treats the risk of claimant insolvency during the interim period as a risk the legislation deliberately allocates to the respondent. Recognised grounds for a stay were narrow: claimants who restructured their finances to defeat recovery, claimants engaged in delaying tactics, or claimants already in liquidation. Kenik was in none of them. The question: can deep financial distress short of liquidation justify a stay?

Hindman J granted the stay on conditions, in reasons given ex tempore on 23 December 2024, although the claimant was not in liquidation; counsel for Kenik submitted it would be the first such case in Queensland (at [49]). Most of the discrete factors actually leaned against Taringa: the adjudicator had substantially accepted Kenik's claim on the merits, the strength of Taringa's substantive case was unclear, the policy of the Building Industry Fairness (Security of Payment) Act 2017 (Qld) (the BIF Act) carries significant weight, and Taringa's own withholding of payment had contributed to Kenik's decline (at [25] to [28]). What carried the day was the core risk: a very high likelihood that, without a stay, the “interim” payment would in substance become final and unrecoverable (at [43], [48]).

The conditions show the balance being struck rather than abandoned. The adjudication costs component was released to Kenik immediately; a tranche referable to subcontractor charges was preserved; the substantive balance stayed in court pending trial; Taringa was required to top up interest; the usual undertaking as to damages applied; and Kenik had liberty to apply, including in relation to litigation funding. Kenik's appeal (CA 224/25) was brought to an end by consent in August 2025 ([2025] QSC 222 at [23], [27]).

In February 2025, Kenik was wound up in insolvency on the pre-existing creditor's application: over 200 unsecured creditors, more than $10 million owed. And in Taringa Property Group Pty Ltd v Kenik Pty Ltd [2025] QSC 222, Taringa was refused leave to continue its substantive proceeding against the company in liquidation, being left to the proof-of-debt process. The stay had protected the fund; it could not manufacture a solvent counterparty to litigate against.

1. 01

   Respondents facing a distressed claimant now have a real, evidenced pathway. The elements that worked here: the adjudicated amount was already in court (BIF Act s 93(4)(b) requires this when a respondent challenges the judgment); commence the substantive proceeding immediately (the stay protects pending something); and assemble concrete solvency evidence: licence suspensions, winding-up applications, financial statements, non-trading status. Speculation about financial weakness gets nowhere; a documented file met the heavy onus.

2. 02

   Expect conditions, not a free pass. Interest top-ups, carve-outs for costs and subcontractor-bound amounts, undertakings as to damages. The court is preserving a fund, not punishing the claimant.

3. 03

   Claimants in distress: the decision cuts both ways. Financial difficulty now invites stay applications even without liquidation, but Hindman J cautioned that such stays will be “a small number of cases” and that fishing applications can attract indemnity costs (at [50]). Counter-strategies visible in the case: evidence of solvency and trading capacity, the argument that the respondent's own non-payment caused the distress (it weighed in Kenik's favour on the discretionary factors), and carve-outs: the court released the adjudication costs to Kenik of its own motion and left access for litigation funding open on liberty to apply.

4. 04

   The risk allocation conversation belongs earlier. For principals, counterparty financial standing at award and during delivery is the cheapest protection: by the time you are resisting enforcement, the money you are protecting is already at risk. Payment-behaviour monitoring, security adequacy and trust/charge regimes all sit upstream of this fight.

5. 05

   A stay protects the fund, not the outcome. The [2025] QSC 222 sequel is the sobering coda: once the claimant entered liquidation, the respondent's “argue later” became a proof of debt. Win the stay, but plan the endgame, including what a liquidator does to your cross-claims.

• Building Industry Fairness (Security of Payment) Act 2017(Qld) ss 93 (adjudication certificate filed as a judgment; payment into court on an application to set it aside), 97B and 126 (subcontractors' charges).
• Uniform Civil Procedure Rules 1999 (Qld) r 800 (stay of enforcement).
• Corporations Act 2001 (Cth) ss 459A (winding up in insolvency), 471B (leave to proceed against a company in liquidation).
• R J Neller Building Pty Ltd v Ainsworth [2008] QCA 397; [2009] 1 Qd R 390.
• Taringa Property Group Pty Ltd v Kenik Pty Ltd [2024] QSC 298 (the failed jurisdictional error challenge).
• Taringa Property Group Pty Ltd v Kenik Pty Ltd [2025] QSC 222 (leave to proceed refused).