Security of Payment Claims over the Christmas period

With the Christmas and New Year holiday period upon us, it is important to have a plan in place to adequately deal with any Payment Claims or Adjudication Applications made under the Building and Construction Industry Security of Payment Act 2009 (Tas) (Act) which may be received around the holiday period and particularly while your office is closed.

The definition of business day under the Act has been amended and now the 27th, 28th, 29th, 30th or 31st of December (in addition to those days specified in the relevant parts of the Statutory Holidays Act 2000 (Tas) and Saturday and Sunday) are not “business days” for the purpose of the Act.

Before this amendment, time limits for providing “Payment Schedules”, making Adjudication Applications or delivering Adjudication Responses continued to run; meaning that the effective time to prepare the necessary documents was either reduced or missed altogether. The rationale behind the amendment was to ensure that time limits were not missed because of businesses being closed or key staff being “on leave”. Some jurisdictions have gone further to incorporate the New Year period – for example in Queensland this period is extended to the 10th of January.

Despite this grace period, it is still important to remain vigilant over the remainder of the Christmas and New Year period, particularly if your office is closed before the 25th of December and after the 1st of January. With the usual increase in staff taking leave during December and January, businesses are more exposed to missing time limits resulting in a potentially significant liability.

Under the Act, time limits cannot be increased and a document can still be “received” even if it does not come to the attention of anyone at your business within the time limit.

To minimise your chance of exposure, it is important to put in place a procedure to deal with potential receipt of “Payment Claims” or Adjudication Applications which may include:

  • Ascertaining which staff will likely receive documentation issued under the Act (and in doing so taking into account the possibility that some staff will be filling in for others who are on leave) and ensuring that they are able to identify the importance of the documentation;
  • Ensuring that staff know what to do if a Payment Claim or Adjudication Application is received and ensuring that any person that they need to contact will be available over the period;
  • Conducting a thorough review of all correspondence on the 3rd of January 2016 to identify any document under the Act which may have been received over the Christmas period; and
  • Reviewing current projects which attract a higher risk of receipt of a document under the Act and ensuring that extra steps have been taken prior to the Christmas period to address potential issues that may arise.

If you have any queries or require further information about this article, please contact Kathryn Speed (kspeed@pageseager.com.au) or David Palser (dpalser@pageseager.com.au).

 

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