New Security of Payment Legislation in Queensland: Are You Prepared?
On 17 December 2018, Chapter 3 of the Building Industry Fairness (Security of Payment) Act 2017 (the Act) commenced in Queensland in place of the Building and Construction Industry Payments Act 2004 (Qld). It brings with it a raft of significant reforms to the State’s security of payment laws.
Under the new legislation, there is no longer a requirement for a payment claim to state that it is one made under the Act. Instead, Payment Claims must simply comply with three requirements, namely it must:
1. Identify the work to which it relates;
2. State the amount claimed; and
3. Request payment of the claimed amount (a written document bearing the word ‘invoice’ will satisfy this requirement).
Another key change is the timeframes applicable for submission of payment schedules. A payment schedule must be provided within 15 business days of receiving the payment claim unless a shorter period is specified in the contract.
Importantly, there will no longer be any second chances to submit a payment schedule if it is not submitted within the time required. A failure to serve a payment schedule means the full amount of the claim is due and payable by the due date for payment. The claimant may pursue its right to this amount at adjudication or in Court and the respondent will not be entitled to raise any substantive defence.
There have also been a number of amendments in respect of the adjudication process.
A claimant now has 30 business days to lodge an adjudication application.
Further, a respondent is no longer able to include new reasons in an adjudication response which were not raised in the payment schedule. This means it is particularly important that all reasons for contesting the payment claim are set out in the payment schedule. In addition, the failure to provide a payment schedule is an offence. The only circumstance in which it is permitted to not serve a payment schedule is if the respondent pays the full amount by the due date for payment.
The Act also introduces a new or additional reference date after termination of a contract, if not already provided for in the contract.
Holding Redlich has one of the largest dedicated specialist construction and infrastructure teams in Queensland and specialises in security of payment disputes.