Building and Construction Industry Security of Payment Act 2002 (the Act)

What does the Act do?

The Security Of Payments Act creates a statutory entitlement for a Claimant to be paid for construction work that has been carried out or construction related goods and services that have been supplied to a Respondent. By the provision of a Payment Claim and having it adjudicated under the Act.

Have a question? Email us or ring 1300 76 86 30 for an outcome.

What sorts of the things are covered by the Act?

The Security Of Payments Act covers ‘Construction Work’ which is basically all building and related trades that are carried out for anybody that is not a resident home owner.

The Act also covers ‘Construction related goods and services’, if they have been provided by a supplier (such as a wholesaler) or person who provides services (such as a designer) if supplying or working for anybody that is not a resident home owner.

Note: The Act does not cover mining work.

Have a question? Email us or ring 1300 76 86 30 for an outcome.

I have received a Payment Claim what do I do?

You should provide a Payment Schedule within 10 business days.

Have a question? Email us or ring 1300 76 86 30 for an outcome.

How do I know that it is a Payment Claim?

A Payment Claim must:

(a)   Identify the construction work (or related goods and services) to which the progress payment relates;
(b)   Indicate the amount of the progress payment that the claimant claims to be due (the "claimed amount"); and
(c)   State that it is made under this Act.

Have a question? Email us or ring 1300 76 86 30 for an outcome.

What is a Payment Schedule?

A Payment Schedule is a document that indicates what the Claimant is to be paid by the Respondent,

A Payment Schedule must:

(a)   Identify the Payment Claim to which it relates;
(b)   Indicate the amount of the progress payment that the Respondent proposes to make; and
(c)   If the Respondent proposes to pay less than the claimed amount state the reasons for withholding payment.

A Payment Schedule requires all of these 3 items or it is not a Payment Schedule.

A Payment Schedule can be served by post, fax, email or hand-delivery.

Note: Unlike similar Security Of Payments acts in other states, in Victoria, the Respondent’s position is not limited by the Payment Schedule. However, if you have any doubt advice should be sought when preparing the Payment Schedule.

Have a question? Email us or ring 1300 76 86 30 for an outcome.

I did not provide a Payment Schedule within 10 business days

If you did not provide a Payment Schedule the Claimant needs to wait until the due date for payment of its Payment Claim to pass and submit a notice under Section 18 (2) of the Security Of Payments Act.

Once you receive this notice you have 2 business days to provide a Payment Schedule.

Have a question? Email us or ring 1300 76 86 30 for an outcome.

What is going to happen?

If you have provided a Payment Schedule and the Claimant still thinks that they are entitled to be paid they may make an Adjudication Application.

If they do you will be notified by the Adjudicator and given an opportunity to provide an Adjudication Response.

Note: The contents of the Adjudication Response are not limited by the Payment Schedule. However, the Claimant has a right to respond to the Adjudication Response.

In reality if you owe the Claimant money for construction work that has been carried out you should pay them.

However, if you legitimately feel that you are being inappropriately charged or over charged there are ways of maximising your opportunities and minimising risks.

Have a question? Email us or ring 1300 76 86 30 for an outcome.

My client has told me that they have been approached because I have lost an Adjudication Determination and my client is not going to pay me. Can they do this?

The short answer is yes.

The longer answer is it all depends.

If this happens you need to contact somebody for assistance.

Have a question? Email us or ring 1300 76 86 30 for an outcome.