Stop the Press - 20 days of Christmas under BCIPA
Dec 2014 |
The long awaited amendments to the Building and Construction Industry Payments Act 2004 (Qld) (BCIPA) commenced on 15 December 2014.
Christmas shut-down
The immediate effect for all existing contracts is that for all payment claims, the non-business days period for the Christmas period will now be 22 December 2014 to 10 January 2015.
This extends the non-business period from at least eight non-business days to 20 non-business days. The amendment will apply regardless of whether the construction contact was entered into or after 15 December 2015.
Other changes
Other than the Christmas timing changes, the BCIPA regime remains largely the same, except for the following:
Contracts entered into before 15 December 2014:
- The time for making a payment claim (or a final payment claim) will be reduced from 12 months to six months. However, for existing contracts there is a transition period until 15 June 2015 during which claims that are up to 12 months old may still be brought.
- Adjudication applications already lodged with an authorised nominating authority (ANA) prior to 15 December 2014, but not referred to an adjudicator, must be referred by the ANA to an adjudicator.
- Any adjudication issued on or after 15 December 2015 must be lodged with the Queensland Building and Construction Commission (QBCC).
Contracts entered into on or after 15 December 2014:
- Any adjudication issued on or after 15 December 2015 must be lodged with the QBCC. There is no longer referral to individual ANAs – the QBCC will administer the distribution of all claims to adjudicators.
- Payment claims can be issued within the later of the period set out in the construction contract or six months after construction works were carried out, or the goods and services to which the claim relates were last supplied.
- However, if the claim is a final payment claim, then the period is the later of the period specified under the construction contract or 28 days after the end of the last defects liability period or six months after the construction work was completed or the goods and services were supplied.
The BCIPA now allows for two classes of payment claim:
- Payment claims for more than $750,000 (excluding GST) are called complex payment claims;
- Payment claims which are not complex payment claims are called standard payment claims.
- For standard payment claims the existing time periods apply; that is a payment schedule is required to be served on the claimant, within 10 business days after the payment claim is served or the period under the construction contract if it specifies a shorter period.
- For complex payment claims, the period for serving a payment schedule is the earlier of:
- The time specified in the construction contract; or
- One of the following periods:
- if the payment claim is served 90 days or less after the reference date to which the claim relates – 15 business days;
- if the payment claim is served more than 90 days after the reference date to which the claim relates – 30 business days,
after the payment claim is served. This gives significantly longer periods to respond to complex claims (particularly where more than three months has passed since the work was done).
Failure to lodge a payment schedule in time
Under the existing regime, if a respondent failed to issue a payment schedule within 10 business days it was exposed to judgment being awarded against it.
However, under the amended BCIPA regime, a claimant can no longer directly apply for summary judgment in those circumstances. A claimant is now required to wait until the due date for payment has passed and then issue a notice giving the respondent five business days to deliver a payment schedule. If the respondent issues a valid payment schedule within the five business day period, the claimant is not entitled to proceed to litigation (but may proceed to adjudication). Alternatively, if the respondent still fails to deliver a payment schedule the claimant may proceed to litigation or adjudication.
We will provide a further update setting out the further effects of the amendments to the Building and Construction Industry Payments Act 2004 (Qld) in the New Year.
In the meantime, if you have any queries or wish to discuss how these amendments will affect you, please contact us. Carter Newell is well resourced to handle BCIPA matters at all levels specialising in large scale and complex claims and brings particular expertise to this area.
