Making Payment Claims under the Building and Construction Industry (Security of Payment) Act 2009 (ACT)

Master Builders ACT has recently had a number of enquiries regarding the payment claims under the Building and Construction Industry (Security of Payment) Act 2009 (ACT) (the SOPA). Members are reminded that there are strict requirements that need to be followed whilst preparing a payment claim.

Am I eligible to make a claim under the SOPA? 

The SOPA regime is available to a person who carries out construction work in the ACT (including contractors, subcontractors, suppliers, plant and equipment hire and consultants) to allow for a claim to be made in relation to monies owed under certain construction contracts.

This regime does not apply to a construction contract for residential building work where the works are carried out for the occupant of the property (or where they propose to live in the property).

When to make a payment claim?

A payment claim must be made either:

• on the date for making a payment claim under the contract, or
• if the contract is silent, on and from the last day of the month in respect to the work carried out in that month.

What is required in making a payment claim?

A payment claim must:

• be in writing and addressed to the respondent,
• describe the construction work, related goods, or related services for which are being claimed,
• state the amount being claimed, and
• include the words, ‘This is a payment claim made under the Building and Construction Industry (Security of Payment) Act 2009 (ACT)’ or a similar statement with that meaning.

Your claim should establish a reference date for making the claim, decide the payment entitlement, be served on the other party and keep a note of the date the payment claim has been sent to the other party.  Your claim might also include attachments such as completion certificates, photos/videos, delivery documents, or other documents applicable to the contract.

What happens if the payment is made after the due date?

If the payment is not made by the due date or where a response is not received in relation to the payment claim, you may then be entitled to make an application for adjudication under the SOPA regime.  It is crucial that you (the claimant) comply with the timeframes set out in the legislation.

When to make an application for adjudication?

A claimant may seek adjudication if:

• the respondent fails to provide a payment schedule and fails to pay the whole or any of the claimed amount;
• there is a dispute over the respondent’s reasons for withholding some or all of the claimed amount provided in a payment schedule; or
• the claimant has accepted the payment schedule but the respondent fails to pay the scheduled amount by the due date of payment.

Before an application for adjudication is made, the claimant must notify the respondent within 20 business days immediately following the due date for payment, of its intention to apply for adjudication. The respondent then has 5 business days to provide a payment schedule if no payment schedule has been previously provided.

For further information about making a claim under the SOPA regime, click here.

If you have any questions or need assistance in making a claim under the SOPA, please contact our Workplace Relations and Legal Team on (02) 6175 5900.