building & construction industry act 2002

7/31/2019 Building & Construction Industry Act 2002

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Version No. 010

Building and Construction Industry Security

of Payment Act 2002

No. 15 of 2002

Version incorporating amendments as at 30 March 2007

TABLE OF PROVISIONS

Section Page

PART 1PRELIMINARY 1

1 Purpose 12 Commencement 13 Object of Act 14 Definitions 25 Definition ofconstruction work 76 Definition ofrelated goods and services 97 Application of Act 10

8 Act binds the Crown 12

PART 2RIGHTS TO PROGRESS PAYMENTS 13

9 Rights to progress payments 1310 Amount of progress payment 1510A Claimable variations 1510B Excluded amounts 1811 Valuation of construction work and related goods and services 1912 Due date for payment 2012A Lien in respect of unpaid progress payment 2113 Effect ofpay when paidprovisions 22

PART 3PROCEDURE FOR RECOVERING PROGRESS

PAYMENTS 24

Division 1Payment claims and payment schedules 24

14 Payment claims 2415 Payment schedules 2616 Consequences of not paying claimant where no payment

schedule 2717 Consequences of not paying claimant in accordance with

payment schedule 29


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Division 2Adjudication of disputes 31

18 Adjudication applications 3119 Eligibility criteria for adjudicators 3320 Appointment of adjudicator 3321 Adjudication responses 3422 Adjudication procedures 3523 Adjudicator's determination 3723A Adjudication determination to be given to parties and Building

Commission 3924 Correcting mistakes in determinations 402527. Repealed 40

28 Claimant may make new application if previous applicationrefused or not determined 41

Division 2AReview of adjudication 41

28A Threshold for review 4128B Application for review by respondent 4228C Application for review by claimant 4228D Procedure for making application 4328E Right to make submissions 4328F Designated trust account 4428G Appointment of review adjudicator 4528H Adjudication review procedures 4528I Adjudication review determination 46

28J Authorised nominating authority must notify persons of reviewdetermination 49

28K Withdrawal of adjudication review application 4928L Correcting mistakes in review determinations 49

Division 2BPayment and recovery of adjudicated amounts 50

28M Respondent required to pay adjudicated amount 5028N Payment after review determination 5028O Consequences of respondent not paying adjudicated amount 5128P Consequences of claimant not paying adjudicated amount 5228Q Adjudication certificates 5228R Proceedings to recover amount payable under section 28M

or 28N 53

Division 3Claimant's right to suspend construction work 55

29 Claimant may suspend work 55

Division 4Recovery from principal 56

29A Definitions 5630 Application 5731 Recovery from principal 5732 Procedure for obtaining payment 58


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33 Certification of debt by court 5834 Notice of claim operates as assignment of debt 5835 Payment of respondent's debt by principal 5936 Priority of assignments 5937 Stay of payments 6038 Right of recovery if principal fails to pay 6139 When assignment ceases to operate 6140 Claimant to provide discharge notice 6241 Respondent to give information about principal 63

Division 5Authorised nominating authorities, adjudicators and

review adjudicators 63

42 Authorised nominating authorities 6343 The Building Commission may impose conditions 6443A Functions of an authorised nominating authority 6443B Authorised nominating authority to provide information 6543C Authorised nominating authority fees 6544 Ministerial guidelines 6645 Adjudicator's and review adjudicator's fees 6746 Liability of adjudicator 68

Division 6Effect of Part on civil proceedings 69

47 Effect of Part on civil proceedings 69

PART 3AADMINISTRATION 7147A Functions of the Building Commission 7147B Register of authorised nominating authorities 7147C Recording and publishing of determinations 72

PART 4MISCELLANEOUS 73

48 No contracting out 7349 Confidentiality 7350 Service of notices 7351 Supreme Courtlimitation of jurisdiction 7452 Regulations 7453 Transitional provisionBuilding and Construction Industry

Security of Payment (Amendment) Act 2006 7554. Repealed 76


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ENDNOTES 77

1. General Information 77

2. Table of Amendments 78

3. Explanatory Details 79

INDEX 80


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Version No. 010

Building and Construction Industry Security

of Payment Act 2002

No. 15 of 2002

Version incorporating amendments as at 30 March 2007

The Parliament of Victoria enacts as follows:

PART 1PRELIMINARY

1 Purpose

The main purpose of this Act is to provide forentitlements to progress payments for personswho carry out construction work or who supplyrelated goods and services under constructioncontracts.

2 Commencement

(1) Subject to subsection (2), this Act comes intooperation on a day to be proclaimed.

(2) If this Act does not come into operation before31 January 2003, it comes into operation on thatday.

3 Object of Act

(1) The object of this Act is to ensure that any personwho undertakes to carry out construction work or

who undertakes to supply related goods andservices under a construction contract is entitled toreceive, and is able to recover, progress paymentsin relation to the carrying out of that work and thesupplying of those goods and services.

S. 3(1)amended byNo. 42/2006

s. 4(1)(a)(i)(ii).


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(2) The means by which this Act ensures that a personis entitled to receive a progress payment is bygranting a statutory entitlement to that payment inaccordance with this Act.

(3) The means by which this Act ensures that a personis able to recover a progress payment is byestablishing a procedure that involves

(a) the making of a payment claim by the personclaiming payment; and

(b) the provision of a payment schedule by theperson by whom the payment is payable; and

(c) the referral of any disputed claim to anadjudicator for determination; and

(d) the payment of the amount of the progresspayment determined by the adjudicator; and

(e) the recovery of the progress payment in the

event of a failure to pay.(4) It is intended that this Act does not limit

(a) any other entitlement that a claimant mayhave under a construction contract; or

(b) any other remedy that a claimant may havefor recovering that other entitlement.

4 Definitions

In this Act

adjudicated amountmeans the amount of aprogress payment that an adjudicatordetermines to be payable as referred to insection 23 together with any amount addedto that amount under section 45(7);

adjudication application means an applicationreferred to in section 18;

S. 3(2)amended byNo. 42/2006s. 4(1)(b).

S. 3(3)(d)amended byNo. 42/2006s. 4(1)(c).

S. 3(4)substituted byNo. 42/2006s. 4(2).

s. 4


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adjudication certificate means a certificateprovided by an authorised nominatingauthority under section 28Q;

adjudication determination means adetermination made by an adjudicator undersection 23;

adjudicationfees means any fees or expensescharged by an authorised nominatingauthority or by an adjudicator or reviewadjudicator under this Act;

adjudication response means a response referredto in section 21;

adjudication reviewmeans a review of anadjudication determination underDivision 2A of Part 3;

adjudication review application means anapplication under section 28B or 28C;

adjudicator, in relation to an adjudicationapplication, means the person appointed inaccordance with this Act to determine theapplication;

authorised nominating authority means a personauthorised by the Building Commissionunder section 42 to nominate persons todetermine adjudication applications;

Building Commission means the BuildingCommission established under the BuildingAct 1993;

S. 4 def. ofadjudicationcertificateinserted byNo. 42/2006s. 5(a).

S. 4 def. ofadjudicationdeterminationinserted byNo. 42/2006s. 5(a).

S. 4 def. ofadjudicationfeesinserted byNo. 42/2006s. 5(a).

s. 4

S. 4 def. ofadjudicationreviewinserted byNo. 42/2006s. 5(a).

S. 4 def. ofadjudicationreviewapplicationinserted byNo. 42/2006s. 5(a).


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business day means a day that is not

(a) a Saturday or Sunday; or

(b) a day that is wholly or partly observedas a public holiday throughout Victoria;

certified debtin relation to a claimant, means theamount specified in a debt certificate as

being owed to the claimant;

claimable variation has the meaning given in

section 10A;

claimantmeans a person who serves a paymentclaim under section 14;

claimed amountmeans an amount of a progresspayment claimed to be due for constructionwork carried out, or for related goods andservices supplied, as referred to in

section 14;

construction contractmeans a contract or otherarrangement under which one partyundertakes to carry out construction work, orto supply related goods and services, foranother party;

construction workhas the meaning given insection 5;

debt certificate means a certificate issued under

section 33;designated trust accountmeans an account kept

with a recognised financial institution(whether in the name of the respondent orotherwise) for the purpose of holdingamounts payable to claimants under this Act;

S. 4 def. of

claimablevariationinserted byNo. 42/2006s. 5(a).

s. 4

S. 4 def. ofdesignatedtrust accountamended byNo. 42/2006s. 5(b).


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discharge noticemeans a notice referred to insection 40;

due date, in relation to a progress payment, meansthe due date for the progress payment, asreferred to in section 12;

excluded amounthas the meaning given insection 10B;

exercise in relation to a function, includes performa duty;

function includes power, authority or duty;

judgmentincludes order;

notice of claim means a notice referred to insection 32;

payment claim means a claim referred to insection 14;

payment schedule means a schedule referred to insection 15;

principalmeans a principal referred to insection 31;

progress paymentmeans a payment to which aperson is entitled under section 9, andincludes (without affecting thatentitlement)

(a) the final payment for

(i) construction work carried outunder a construction contract; or

(ii) related goods and servicessupplied under the contract; or

S. 4 def. ofexcludedamountinserted byNo. 42/2006s. 5(a).

s. 4

S. 4 def. ofprogresspaymentsubstituted byNo. 42/2006s. 5(c).


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variation in relation to a construction contract,means a change in the scope of theconstruction work to be carried out, or therelated goods and services to be supplied,under the contract.

5 Definition ofconstruction work

(1) In this Act, construction workmeans any of thefollowing work

(a) the construction, alteration, repair,restoration, maintenance, extension,demolition or dismantling of buildings orstructures forming, or to form, part of land(whether permanent or not);

(b) the construction, alteration, repair,restoration, maintenance, extension,demolition or dismantling of any worksforming, or to form, part of land, includingwalls, roadworks, power-lines,telecommunication apparatus, aircraftrunways, docks and harbours, railways,inland waterways, pipelines, reservoirs,water mains, wells, sewers, industrial plantand installations for the purposes of landdrainage or coast protection;

(c) the installation in any building, structure orworks of fittings forming, or to form, part ofland, including heating, lighting,air-conditioning, ventilation, power supply,drainage, sanitation, water supply, fire

protection, security and communicationssystems;

(d) the external or internal cleaning of buildings,structures or works, so far as it is carried outin the course of their construction, alteration,repair, restoration, maintenance or extension;

S. 4 def. ofvariationinserted byNo. 42/2006s. 5(a).

s. 5

S. 5(1)(c)amended byNo. 42/2006s. 6(a).

S. 5(1)(d)amended byNo. 42/2006s. 6(b).


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(e) any operation which forms an integral partof, or is preparatory to or is for renderingcomplete, work of the kind referred to in

paragraph (a), (b) or (c), including

(i) site clearance, earth-moving,excavation, tunnelling and boring; and

(ii) the laying of foundations; and

(iii) the erection, maintenance or

dismantling of scaffolding; and(iv) the prefabrication of components to

form part of any building, structure orworks, whether carried out on-site oroff-site; and

(v) site restoration, landscaping and theprovision of roadways and other accessworks;

(f) the painting or decorating of the internal orexternal surfaces of any building, structure or

works;

(g) any other work of a kind prescribed for thepurposes of this subsection.

(2) Despite subsection (1), construction workdoesnot include any of the following work

(a) the drilling for, or extraction of, oil or naturalgas;

(b) the extraction (whether by underground orsurface working) of minerals, including

tunnelling or boring, or constructingunderground works, for that purpose;

(c) any other work of a kind prescribed for thepurposes of this subsection.

S. 5(1)(e)(iv)amended byNo. 42/2006s. 6(a).

S. 5(1)(f)amended byNo. 42/2006

s. 6(a).

s. 5


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6 Definition ofrelated goods and services

(1) In this Act, related goods and services, in relationto construction work, means any of the followinggoods and services

(a) goods of the following kind

(i) materials and components to form partof any building, structure or workarising from construction work;

(ii) plant or materials (whether supplied bysale, hire or otherwise) for use inconnection with the carrying out ofconstruction work;

(b) services of the following kind

(i) the provision of labour to carry outconstruction work;

(ii) architectural, design, surveying orquantity surveying services in relation

to construction work;(iii) building, engineering, interior or

exterior decoration or landscapeadvisory or technical services inrelation to construction work;

(c) goods and services of a kind prescribed forthe purposes of this subsection.

(2) Despite subsection (1), related goods and servicesdoes not include any goods or services of a kind

prescribed for the purposes of this subsection.

(3) In this Act, a reference to related goods andservices includes a reference to related goods orservices.

s. 6

S. 6(3)inserted byNo. 42/2006s. 7.


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7 Application of Act

(1) Subject to this section, this Act applies to anyconstruction contract, whether written or oral, or

partly written and partly oral, and so applies evenif the contract is expressed to be governed by thelaw of a jurisdiction other than Victoria.

(2) This Act does not apply to

(a) a construction contract that forms part of a

loan agreement, a contract of guarantee or acontract of insurance under which arecognised financial institution undertakes

(i) to lend money or to repay money lent;or

(ii) to guarantee payment of money owingor repayment of money lent; or

(iii) to provide an indemnity with respect toconstruction work carried out, orrelated goods and services supplied,

under the construction contract; or

(b) a construction contract which is a domesticbuilding contract within the meaning of theDomestic Building Contracts Act 1995

between a builder and a building owner(within the meaning of that Act), for thecarrying out of domestic building work(within the meaning of thatAct), other than acontract where the building owner is in the

business of building residences and the

contract is entered into in the course of, or inconnection with, that business; or

(ba) a construction contract for the carrying out ofany work of a kind referred to in section 6 ofthe Domestic Building Contracts Act 1995relating to a residence other than

s. 7

S. 7(2)(b)substituted byNo. 42/2006s. 8.

S. 7(2)(ba)inserted byNo. 42/2006s. 8.


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(i) a contract where the person for whomthe work is, or is to be, carried out is a

person who is in the business ofbuilding residences and the contract isentered into in the course of, or inconnection with, that business; or

(ii) a contract where the work carried out,or to be carried out, under the contractis, or is part of or is incidental to work

to be carried out under anotherconstruction contract; or

(c) a construction contract under which it isagreed that the consideration payable forconstruction work carried out under thecontract, or for related goods and servicessupplied under the contract, is to becalculated otherwise than by reference to thevalue of the work carried out or the value ofthe goods and services supplied.

(3) This Act does not apply to a construction contractto the extent to which it contains

(a) provisions under which a party undertakes tocarry out construction work, or supplyrelated goods and services, as an employeeof the party for whom the work is to becarried out or the related goods and servicesare to be supplied; or

(b) provisions under which a party undertakes tocarry out construction work, or to supply

related goods and services, as a condition ofa loan agreement with a recognised financialinstitution; or

s. 7


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(c) provisions under which a party undertakes

(i) to lend money or to repay money lent;or

(ii) to guarantee payment of money owingor repayment of money lent; or

(iii) to provide an indemnity with respect toconstruction work carried out, orrelated goods and services supplied,

under the construction contract.(4) This Act does not apply to a construction contract

to the extent to which it deals with

(a) construction work carried out outsideVictoria; and

(b) related goods and services supplied inrespect of construction work carried outoutside Victoria.

(5) This Act does not apply to any construction

contract, or class of construction contracts,prescribed for the purposes of this section.

(6) This Act does not apply to a construction contractentered into before the commencement of thissection.

8 Act binds the Crown

This Act binds the Crown in right of Victoriaand,so far as the legislative power of the Parliament

permits, the Crown in all its other capacities.

__________________

s. 8


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PART 2RIGHTS TO PROGRESS PAYMENTS

9 Rights to progress payments

(1) On and from each reference date under aconstruction contract, a person

(a) who has undertaken to carry out constructionwork under the contract; or

(b) who has undertaken to supply related goodsand services under the contract

is entitled to a progress payment under this Act,calculated by reference to that date.

(2) In this section, reference date, in relation to aconstruction contract, means

(a) a date determined by or in accordance withthe terms of the contract as

(i) a date on which a claim for a progresspayment may be made; or

(ii) a date by reference to which the amountof a progress payment is to becalculated

in relation to a specific item of constructionwork carried out or to be carried out or aspecific item of related goods and servicessupplied or to be supplied under the contract;or

(b) subject to paragraphs (c) and (d), if the

contract makes no express provision withrespect to the matter, the date occurring20 business days after the previous referencedate or (in the case of the first reference date)the date occurring 20 business days after

(i) construction work was first carried outunder the contract; or

s. 9

S. 9(2)(a)amended byNo. 42/2006s. 9(a)(i)(ii).

S. 9(2)(b)amended by

No. 42/2006s. 9(b)(i).


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(ii) related goods and services were firstsupplied under the contract; or

(c) in the case of a single or one-off payment, ifthe contract makes no express provision withrespect to the matter, the date immediatelyfollowing the day that

(i) construction work was last carried out

under the contract; or(ii) related goods and services were last

supplied under the contract; or

(d) in the case of a final payment, if the contractmakes no express provision with respect tothe matter, the date immediately following

(i) the expiry of any period provided in thecontract for the rectification of defectsor omissions in the construction workcarried out under the contract or in

related goods and services suppliedunder the contract, unlesssubparagraph (ii) applies; or

(ii) the issue under the contract of acertificate specifying the final amount

payable under the contract a finalcertificate; or

(iii) if neither subparagraph (i) norsubparagraph (ii) applies, the daythat

(A) construction work was last carriedout under the contract; or

(B) related goods and services werelast supplied under the contract.

S. 9(2)(b)(ii)amended byNo. 42/2006s. 9(b)(ii).

S. 9(2)(c)inserted byNo. 42/2006s. 9(c).

S. 9(2)(d)inserted byNo. 42/2006s. 9(c).

s. 9


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10 Amount of progress payment

(1) The amount of a progress payment to which aperson is entitled in respect of a constructioncontract is to be

(a) the amount calculated in accordance with theterms of the contract; or

(b) if the contract makes no express provisionwith respect to the matter, the amount

calculated on the basis of the value of(i) construction work carried out or

undertaken to be carried out by theperson under the contract; or

(ii) related goods and services supplied orundertaken to be supplied by the personunder the contract

as the case requires.

(2) Despite subsection (1) and anything to the

contrary in the construction contract, a claimablevariation may be taken into account in calculatingthe amount of a progress payment to which a

person is entitled in respect of that constructioncontract.

(3) Despite subsection (1) and anything to thecontrary in the construction contract, an excludedamount must not be taken into account incalculating the amount of a progress payment towhich a person is entitled in respect of thatconstruction contract.

10A Claimable variations

(1) This section sets out the classes of variation to aconstruction contract (the claimable variations)that may be taken into account in calculating theamount of a progress payment to which a personis entitled in respect of that construction contract.

S. 10amended byNo. 42/2006s. 10(2) (ILAs. 39B(1)).

s. 10

S. 10(b)(i)amended byNo. 42/2006s. 10(1)(a).

S. 10(b)(ii)amended byNo. 42/2006s. 10(1)(b).

S. 10(2)inserted by

No. 42/2006s. 10(2).

S. 10(3)inserted byNo. 42/2006s. 10(2).

S. 10Ainserted byNo. 42/2006s. 11.


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(2) The first class of variation is a variation where theparties to the construction contract agree

(a) that work has been carried out or goods andservices have been supplied; and

(b) as to the scope of the work that has beencarried out or the goods and services thathave been supplied; and

(c) that the doing of the work or the supply of

the goods and services constitutes a variationto the contract; and

(d) that the person who has undertaken to carryout the work or to supply the goods andservices under the contract is entitled to a

progress payment that includes an amount inrespect of the variation; and

(e) as to the value of that amount or the methodof valuing that amount; and

(f) as to the time for payment of that amount.

(3) The second class of variation is a variationwhere

(a) the work has been carried out or the goodsand services have been supplied under theconstruction contract; and

(b) the person for whom the work has beencarried out or the goods and servicessupplied or a person acting for that personunder the construction contract requested or

directed the carrying out of the work or thesupply of the goods and services; and

(c) the parties to the construction contract do notagree as to one or more of the following

(i) that the doing of the work or the supplyof goods and services constitutes avariation to the contract;

s. 10A


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(ii) that the person who has undertaken tocarry out the work or to supply thegoods and services under theconstruction contract is entitled to a

progress payment that includes anamount in respect of the work or thegoods and services;

(iii) the value of the amount payable inrespect of the work or the goods and

services;(iv) the method of valuing the amount

payable in respect of the work or thegoods and services;

(v) the time for payment of the amountpayable in respect of the work or thegoods and services; and

(d) subject to subsection (4), the considerationunder the construction contract at the timethe contract is entered into

(i) is $5 000 000 or less; or

(ii) exceeds $5 000 000 but the contractdoes not provide a method of resolvingdisputes under the contract (includingdisputes referred to in paragraph (c)).

(4) If at any time the total amount of claims under aconstruction contract for the second class ofvariations exceeds 10% of the consideration underthe construction contract at the time the contract is

entered into, subsection (3)(d) applies in relationto that construction contract as if any reference to"$5 000 000" were a reference to "$150 000".

Example

A building contractor enters into a construction contract.The consideration (contract sum) under the contract at thetime the contract is entered into is $3 million. The contractcontains a dispute resolution clause. The contractor

s. 10A


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undertakes work at the direction of the other party.The contractor claims (the new claim) that the work is avariation to the contract. The other party does not agree thatthe work constitutes a variation to the contract (disputedvariation). The contractor has already made a number ofclaims for disputed variations under the contract. The newclaim brings the total amount of claims for disputedvariations under the contract to $350 000. This amountexceeds 10% of the contract sum. As the contract sumexceeds $150 000 and the contract contains a disputeresolution clause, the disputed variation in the new claimand all subsequent disputed variations under the contractwill not be claimable variations under this Act.

10B Excluded amounts

(1) This section sets out the classes of amounts(excluded amounts) that must not be taken intoaccount in calculating the amount of a progress

payment to which a person is entitled under aconstruction contract.

(2) The excluded amountsare

(a) any amount that relates to a variation of the

construction contract that is not a claimablevariation;

(b) any amount (other than a claimablevariation) claimed under the constructioncontract for compensation due to thehappening of an event including any amountrelating to

(i) latent conditions; and

(ii) time-related costs; and

(iii) changes in regulatory requirements;

(c) any amount claimed for damages for breachof the construction contract or for any otherclaim for damages arising under or inconnection with the contract;

S. 10Binserted byNo. 42/2006s. 11.

s. 10B


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(d) any amount in relation to a claim arising atlaw other than under the constructioncontract;

(e) any amount of a class prescribed by theregulations as an excluded amount.

11 Valuation of construction work and related goods

and services

(1) Construction work carried out or undertaken to be

carried out under a construction contract is to bevalued

(a) in accordance with the terms of the contract;or

(b) if the contract makes no express provisionwith respect to the matter, having regardto

(i) the contract price for the work; and

(ii) any other rates or prices set out in the

contract; and(iii) if there is a claimable variation, any

amount by which the contract price orother rate or price set out in thecontract, is to be adjusted as a result ofthe variation; and

(iv) if any of the work is defective, theestimated cost of rectifying the defect.

(2) Related goods and services supplied or undertakento be supplied under a construction contract are to

be valued

(a) in accordance with the terms of the contract;or

(b) if the contract makes no express provisionwith respect to the matter, having regardto

s. 11

S. 11(1)amended by

No. 42/2006s. 12(a)(i).

S. 11(1)(b)(iii)substituted byNo. 42/2006s. 12(a)(ii).

S. 11(2)amended byNo. 42/2006

s. 12(b)(i).


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(i) the contract price for the goods andservices; and

(ii) any other rates or prices set out in thecontract; and

(iii) if there is a claimable variation, anyamount by which the contract price orother rate or price set out in thecontract, is to be adjusted as a result ofthe variation; and

(iv) if any goods are defective, theestimated cost of rectifying the defect.

(3) For the purposes of subsection (2)(b), thevaluation of materials and components that are toform part of any building, structure or workarising from construction work is to be on the

basis that the only materials and components to beincluded in the valuation are those that have

become (or, on payment, will become) theproperty of the party for whom construction workis being carried out.

12 Due date for payment

(1) A progress payment under a construction contractbecomes due and payable

(a) on the date on which the payment becomesdue and payable in accordance with theterms of the contract; or

(b) if the contract makes no express provisionwith respect to the matter, on the dateoccurring 10 business days after a paymentclaim is made under Part 3 in relation to the

payment.

S. 11(2)(b)(iii)substituted byNo. 42/2006s. 12(b)(ii).

S. 12amended byNo. 42/2006s. 13 (ILAs. 39B(1)).

s. 12


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(2) Interest is payable on the unpaid amount of aprogress payment that has become due andpayable in accordance with subsection (1) at thegreater of the following rates

(a) the rate for the time being fixed undersection 2 of the Penalty Interest Rates Act1983; or

(b) the rate specified under the constructioncontract.

12A Lien in respect of unpaid progress payment

(1) If a progress payment under a constructioncontract becomes due and payable, the claimant isentitled to exercise a lien in respect of the unpaidamount over any unfixed plant or materialssupplied by the claimant for use in connectionwith the carrying out of construction work for therespondent.

(2) The claimant must serve a notice in the prescribed

form on the respondent before exercising a lienunder subsection (1).

(3) A lien under subsection (1) is extinguished on theclaimant receiving the progress payment.

(4) Any lien or charge over the unfixed plant ormaterials existing before the date on which the

progress payment becomes due and payable takespriority over a lien under subsection (1).

(5) Subsection (1) does not confer on the claimantany right against a third party who is the owner ofthe unfixed plant or materials.

S. 12(2)inserted byNo. 42/2006s. 13.


s. 12A


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13 Effect ofpay when paidprovisions

(1) A pay when paid provision of a constructioncontract has no effect in relation to any paymentfor

(a) construction work carried out or undertakento be carried out under the contract; or

(b) related goods and services supplied or

undertaken to be supplied under the contract.

(2) In this section

money owing, in relation to a constructioncontract, means money owing for

(a) construction work carried out under thecontract; or

(b) related goods and services supplied

under the contract;pay when paid provision of a construction

contract means a provision of the contract

(a) that makes the liability of one party(thefirst party) to pay money owing toanother party (the second party)contingent on payment to the first party

by a further party (the third party) ofthe whole or any part of that money; or

(b) that makes the due date for payment of

money owing by the first party to thesecond party dependent on the date onwhich payment of the whole or any partof that money is made to the first party

by the third party; or

s. 13

S. 13(1)(a)amended byNo. 42/2006s. 15(1)(a).

S. 13(1)(b)

amended byNo. 42/2006s. 15(1)(b).

S. 13(2) def. ofpay whenpaid provisionamended byNo. 42/2006s. 15(2)(a)(b).


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No. 15 of 2002

23

(c) that otherwise makes the liability to paymoney owing, or the due date for

payment of money owing, contingent ordependent on the operation of anothercontract.

__________________

s. 13


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Part 3Procedure for Recovering Progress Payments


No. 15 of 2002

24

PART 3PROCEDURE FOR RECOVERING PROGRESS

PAYMENTS

Division 1Payment claims and payment schedules

14 Payment claims

(1) A person referred to in section 9(1) who is or whoclaims to be entitled to a progress payment

(the claimant) may serve a payment claim on theperson who, under the construction contractconcerned, is or may be liable to make the

payment.

(2) A payment claim

(a) must be in the relevant prescribed form(if any); and

(b) must contain the prescribed information(if any); and

(c) must identify the construction work orrelated goods and services to which theprogress payment relates; and

(d) must indicate the amount of the progresspayment that the claimant claims to be due(the claimed amount); and

(e) must state that it is made under this Act.

(3) The claimed amount

(a) may include any amount that the respondent

is liable to pay the claimant under section29(4);

(b) must not include any excluded amount.

Note

Section 10(3) provides that a progress payment must notinclude an excluded amount.

S. 14substituted byNo. 42/2006s. 16.

s. 14


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No. 15 of 2002

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(4) A payment claim in respect of a progress payment(other than a payment claim in respect of a

progress payment that is a final, single or one-offpayment) may be served only within

(a) the period determined by or in accordancewith the terms of the construction contract inrespect of the carrying out of the item ofconstruction work or the supply of the itemof related goods and services to which the

claim relates; or(b) the period of 3 months after the reference

date referred to in section 9(2) that relates tothat progress payment

whichever is the later.

(5) A payment claim in respect of a progress paymentthat is a final, single or one-off payment may beserved only within

(a) the period determined by or in accordance

with the terms of the construction contract;or

(b) if no such period applies, within 3 monthsafter the reference date referred to in section9(2) that relates to that progress payment.

(6) Subject to subsection (7), once a payment claimfor a claimed amount in respect of a final, singleor one-off payment has been served under thisAct, no further payment claim can be served underthisAct in respect of the construction contract to

which the payment claim relates.

(7) Nothing in subsection (6) prevents a paymentclaim for a claimed amount in respect of a final,single or one-off payment being served under thisAct in respect of a construction contract if

s. 14


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No. 15 of 2002

26

(a) a claim for the payment of that amount hasbeen made in respect of that payment underthe contract; and

(b) that amount was not paid by the due dateunder the contract for the payment to whichthe claim relates.

(8) A claimant cannot serve more than one paymentclaim in respect of each reference date under theconstruction contract.

(9) However, subsection (8) does not prevent theclaimant from including in a payment claim anamount that has been the subject of a previousclaim if the amount has not been paid.

15 Payment schedules

(1) A person on whom a payment claim is served (therespondent) may reply to the claim by providing a

payment schedule to the claimant.

(2) A payment schedule

(a) must identify the payment claim to which itrelates; and

(b) must indicate the amount of the payment(if any) that the respondent proposes to make(the scheduled amount); and

(c) must identify any amount of the claim thatthe respondent alleges is an excludedamount; and

(d) must be in the relevant prescribed form

(if any); and

(e) must contain the prescribed information(if any).

s. 15

S. 15(2)(b)amended byNo. 42/2006s. 17(1).

S. 15(2)(c)inserted byNo. 42/2006s. 17(2).

S. 15(2)(d)

inserted byNo. 42/2006s. 17(2).

S. 15(2)(e)inserted byNo. 42/2006s. 17(2).


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No. 15 of 2002

27

(3) If the scheduled amount is less than the claimedamount, the schedule must indicate why thescheduled amount is less and (if it is less becausethe respondent is withholding payment for anyreason) the respondent's reasons for withholding

payment.

(4) If

(a) a claimant serves a payment claim on arespondent; and

(b) the respondent does not provide a paymentschedule to the claimant

(i) within the time required by the relevantconstruction contract; or

(ii) within 10 business days after thepayment claim is served;

whichever time expires earlier

the respondent becomes liable to pay the claimed

amount to the claimant on the due date for theprogress payment to which the payment claimrelates.

16 Consequences of not paying claimant where no

payment schedule

(1) This section applies if the respondent

(a) becomes liable to pay the claimed amount tothe claimant under section 15(4) as aconsequence of having failed to provide a

payment schedule to the claimant within the

time allowed by that section; and

(b) fails to pay the whole or any part of theclaimed amount on or before the due date forthe progress payment to which the paymentclaim relates.

s. 16


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No. 15 of 2002

28

(2) In those circumstances, the claimant

(a) may

(i) recover the unpaid portion of theclaimed amount from the respondent, asa debt due to the claimant, in any courtof competent jurisdiction; or

(ii) make an adjudication application undersection 18(1)(b) in relation to the

payment claim; and(b) may serve notice on the respondent of the

claimant's intention

(i) to suspend carrying out constructionwork under the construction contract;or

(ii) to suspend supplying related goods andservices under the constructioncontract.

(3) A notice referred to in subsection (2)(b) must statethat it is made under this Act.

(4) If the claimant commences proceedings undersubsection (2)(a)(i) to recover the unpaid portionof the claimed amount from the respondent as adebt

(a) judgment in favour of the claimant is not tobe given unless the court is satisfied

(i) of the existence of the circumstancesreferred to in subsection (1); and

(ii) that the claimed amount does notinclude any excluded amount; and

S. 16(2)(a)substituted byNo. 42/2006s. 18(1).

s. 16



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29

(b) the respondent is not, in those proceedings,entitled

(i) to bring any cross-claim against theclaimant; or

(ii) to raise any defence in relation tomatters arising under the constructioncontract.

17 Consequences of not paying claimant in accordance

with payment schedule(1) This section applies if

(a) a claimant serves a payment claim on arespondent; and

(b) the respondent provides a payment scheduleto the claimant

(i) within the time required by the relevantconstruction contract; or

(ii) within 10 business days after the

payment claim is served

whichever time expires earlier; and

(c) the payment schedule indicates a scheduledamount that the respondent proposes to payto the claimant; and

(d) the respondent fails to pay the whole or anypart of the scheduled amount to the claimanton or before the due date for the progress

payment to which the payment claim relates.

(2) In those circumstances, the claimant

(a) may

(i) recover the unpaid portion of thescheduled amount from the respondent,as a debt due to the claimant, in anycourt of competent jurisdiction; or

s. 17

S. 17(2)(a)substituted byNo. 42/2006s. 19(1).


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No. 15 of 2002

30

(ii) make an adjudication application undersection 18(1)(a)(ii) in relation to the

payment claim; and

(b) may serve notice on the respondent of theclaimant's intention to suspend

(i) carrying out construction work underthe construction contract; or

(ii) supplying related goods and services

under the construction contract.(3) A notice referred to in subsection (2)(b) must state

that it is made under this Act.

(4) If the claimant commences proceedings undersubsection (2)(a)(i) to recover the unpaid portionof the scheduled amount from the respondent as adebt

(a) judgment in favour of the claimant is not tobe given unless the court is satisfied of theexistence of the circumstances referred to in

subsection (1); and

(b) the respondent is not, in those proceedings,entitled

(i) to bring any cross-claim against theclaimant; or

(ii) to raise any defence in relation tomatters arising under the constructioncontract.


s. 17


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Division 2Adjudication of disputes

18 Adjudication applications

(1) A claimant may apply for adjudication of apayment claim (an adjudication application) if

(a) the respondent provides a payment scheduleunder Division 1 but

(i) the scheduled amount indicated in the

payment schedule is less than theclaimed amount indicated in thepayment claim; or

(ii) the respondent fails to pay the whole orany part of the scheduled amount to theclaimant by the due date for payment ofthe amount; or

(b) the respondent fails to provide a paymentschedule to the claimant under Division 1and fails to pay the whole or any part of the

claimed amount by the due date for paymentof the amount.

(2) An adjudication application to which subsection(1)(b) applies cannot be made unless

(a) the claimant has notified the respondent,within the period of 10 business daysimmediately following the due date for

payment, of the claimant's intention to applyfor adjudication of the payment claim; and

(b) the respondent has been given an opportunity

to provide a payment schedule to theclaimant within 2 business days afterreceiving the claimant's notice.

s. 18




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No. 15 of 2002

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(3) An adjudication application

(a) must be in writing; and

(b) subject to subsection (4), must be made to anauthorised nominating authority chosen bythe claimant; and

(c) in the case of an application under subsection(1)(a)(i), must be made within 10 businessdays after the claimant receives the payment

schedule; and(d) in the case of an application under subsection

(1)(a)(ii), must be made within 10 businessdays after the due date for payment; and

(e) in the case of an application under subsection(1)(b), must be made within 5 business daysafter the end of the 2 day period referred toin subsection (2)(b); and

(f) must identify the payment claim and thepayment schedule (if any) to which it relates;

and

(g) must be accompanied by the application fee(if any) determined by the authorisednominating authority; and

(h) may contain any submissions relevant to theapplication that the claimant chooses toinclude.

(4) If the construction contract to which the paymentclaim relates lists 3 or more authorised nominating

authorities, the application must be made to one ofthose authorities chosen by the claimant.

(5) A copy of the adjudication application must beserved on the respondent.

* * * * *


s. 18


S. 18(6)repealed byNo. 42/2006s. 20(2).


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33

(7) It is the duty of an authorised nominatingauthority to which an adjudication application ismade to refer the application to an adjudicator assoon as practicable.

(8) An adjudicator to whom an application is referredunder subsection (7) must be a person who iseligible to be an adjudicator as referred to insection 19.

19 Eligibility criteria for adjudicators

(1) A person is eligible to be an adjudicator in relationto a construction contract

(a) if the person is a natural person; and

(b) if the person has any qualifications, expertiseand experience that may be prescribed forthe purposes of this section.

(2) A person is not eligible to be an adjudicator inrelation to a particular construction contract

(a) if the person is a party to the contract; or(b) if the person is an employee of a party to the

contract; or

(c) in the circumstances that are prescribed forthe purposes of this section; or

(d) if the person is in a class of person that isprescribed for the purposes of this section.

20 Appointment of adjudicator

(1) An adjudicator accepts an adjudication application

by causing notice of acceptance to be served onthe claimant and the respondent.

(2) The acceptance takes effect when the last of thenotices is served under subsection (1).

(3) On accepting an adjudication application, theadjudicator is taken to have been appointed todetermine the application.

S. 18(8)amended byNo. 42/2006s. 20(3).

s. 19


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(4) An adjudicator must give a copy of a notice ofacceptance under subsection (1) to the BuildingCommissionwithin 10 business days afteraccepting an adjudication application undersubsection (1).

21 Adjudication responses

(1) Subject to subsection (2A), the respondent maylodge with the adjudicator a response to theclaimant's adjudication application (theadjudication response) at any time within

(a) 5 business days after receiving a copy of theapplication; or

(b) 2 business days after receiving notice of anadjudicator's acceptance of the application

whichever time expires later.

(2) The adjudication response

(a) must be in writing; and

(b) must identify the adjudication application towhich it relates; and

(c) must include the name and address of anyrelevant principal of the respondent and anyother person who the respondent knows has afinancial or contractual interest in the mattersthat are the subject of the adjudicationapplication; and

(ca) must identify any amount of the paymentclaim that the respondent alleges is an

excluded amount; and

(d) may contain any submissions relevant to theresponse that the respondent chooses toinclude.

s. 21

S. 21(1)amended byNo. 42/2006s. 21(1)(a).

S. 21(2)(c)substituted byNo. 42/2006s. 21(1)(b).

S. 21(2)(ca)inserted byNo. 42/2006

s. 21(1)(b).


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35

(2A) The respondent may lodge an adjudicationresponse only if the respondent has provided a

payment schedule to the claimant within the timespecified in section 15(4) or 18(2)(b).

(2B) If the adjudication response includes any reasonsfor withholding payment that were not included inthe payment schedule, the adjudicator must servea notice on the claimant

(a) setting out those reasons; and

(b) stating that the claimant has 2 business daysafter being served with the notice to lodge aresponse to those reasons with theadjudicator.

(3) A copy of the adjudication response must beserved on the claimant.

(4) In this section relevant principalin relation to therespondent, means any person with whom therespondent has entered into a contract (that is not

a construction contract exempted from this Actunder section 7(2)(b) or 7(2)(ba)) for the provision

by the respondent of construction work or goodsand services if the construction work carried outor the goods and services supplied by the claimantto or for the respondent under the constructioncontract are, or are part of or incidental to, theconstruction work or goods and services that thefirst-mentioned person engaged the respondent tocarry out or supply.

22 Adjudication procedures

(1) An adjudicator is not to determine an adjudicationapplication until after the end of the period withinwhich the respondent may lodge an adjudicationresponse.

S. 21(2A)inserted byNo. 42/2006s. 21(2).

S. 21(2B)inserted byNo. 42/2006s. 21(2).

S. 21(4)amended byNo. 42/2006s. 21(3).

s. 22


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No. 15 of 2002

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(2) An adjudicator must serve a written notice

(a) on any relevant principal and any otherperson who is included in the adjudicationresponse under section 21(2)(c); and

(b) on any other person who the adjudicatorreasonably believes, on the basis of anysubmission received from the claimant or therespondent, is a person who has a financialor contractual interest in the matters that arethe subject of the adjudication application.

(3) An adjudicator is not to consider an adjudicationresponse unless it was made before the end of the

period within which the respondent may lodge theresponse.

(4) Subject to subsections (1) and (3), an adjudicatoris to determine an adjudication application asexpeditiously as possible and, in any case

(a) within 10 business days after the date on

which the acceptance by the adjudicator ofthe application takes effect in accordancewith section 20(2); or

(b) within any further time, not exceeding15 business days after that date, to which theclaimant agrees.

(4A) A claimant must not unreasonably withhold theiragreement under subsection (4)(b).

(5) For the purposes of any proceedings conducted todetermine an adjudication application, anadjudicator

(a) may request further written submissionsfrom either party and must give the other

party an opportunity to comment on thosesubmissions; and


s. 22

S. 22(4)(b)substituted byNo. 42/2006s. 22(2).



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No. 15 of 2002

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(b) may set deadlines for further submissionsand comments by the parties; and

(c) may call a conference of the parties; and

(d) may carry out an inspection of any matter towhich the claim relates.

(5A) Any conference called under subsection (5)(c) isto be conducted informally and the parties are notentitled to legal representation unless this is

permitted by the adjudicator.(6) The adjudicator's power to determine an

application is not affected by the failure of eitheror both of the parties to make a submission orcomment within the time or to comply with theadjudicator's call for a conference of the parties.

23 Adjudicator's determination

(1) An adjudicator is to determine

(a) the amount of the progress payment (if any)

to be paid by the respondent to the claimant(the adjudicated amount); and

(b) the date on which that amount became orbecomes payable; and

(c) the rate of interest payable on that amount inaccordance with section 12(2).

Note

The adjudicated amount may be added to undersection 45(8).


s. 23

S. 23(1)(b)amended byNo. 42/2006s. 23(1)(a).

S. 23(1)(c)inserted byNo. 42/2006s. 23(1)(b).

Note tos. 23(1)amended byNo. 42/2006s. 23(1)(c).


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(2) In determining an adjudication application, theadjudicator must consider the following mattersand those matters only

(a) the provisions of this Act and any regulationsmade under this Act;

(b) subject to this Act, the provisions of theconstruction contract from which theapplication arose;

(c) the payment claim to which the applicationrelates, together with all submissions(including relevant documentation) that have

been duly made by the claimant in support ofthe claim;

(d) the payment schedule (if any) to which theapplication relates, together with allsubmissions (including relevantdocumentation) that have been duly made bythe respondent in support of the schedule;

(e) the results of any inspection carried out bythe adjudicator of any matter to which theclaim relates.

(2A) In determining an adjudication application, theadjudicator must not take into account

(a) any part of the claimed amount that is anexcluded amount; or

(b) any other matter that is prohibited by thisAct from being taken into account.

(2B) An adjudicator's determination is void(a) to the extent that it has been made in

contravention of subsection (2);

(b) if it takes into account any amount or matterreferred to in subsection (2A), to the extentthat the determination is based on thatamount or matter.

S. 23(2)amended byNo. 42/2006s. 23(1)(d).

S. 23(2)(b)amended byNo. 42/2006s. 23(1)(e).

S. 23(2)(d)amended byNo. 42/2006s. 23(1)(f).

s. 23


S. 23(2B)inserted byNo. 42/2006s. 23(2).


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(3) The adjudicator's determination must be in writingand must include

(a) the reasons for the determination; and

(b) the basis on which any amount or date hasbeen decided.

(4) If, in determining an adjudication application, anadjudicator has, in accordance with section 11,determined

(a) the value of any construction work carriedout under a construction contract; or

(b) the value of any related goods and servicessupplied under a construction contract

the adjudicator (or any other adjudicator) is, inany subsequent adjudication application thatinvolves the determination of the value of thatwork or of those goods and services, to give thework or the goods and services the same value asthat previously determined unless the claimant or

respondent satisfies the adjudicator concerned thatthe value of the work or the goods and serviceshas changed since the previous determination.

23A Adjudication determination to be given to parties

and Building Commission

The authorised nominating authority to whom theadjudication application was made must give acopy of the adjudication determination

(a) to the claimant and the respondent, as soon

as practicable after it is made; and(b) to the Building Commission within

5 business days after it is made.




s. 23A


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24 Correcting mistakes in determinations

(1) An adjudicator may correct a determination madeby him or her if the determination contains

(a) a clerical mistake; or

(b) an error arising from an accidental slip oromission; or

(c) a material miscalculation of figures or amaterial mistake in the description of any

person, thing or matter referred to in thedetermination; or

(d) a defect of form.

(2) The correction may be made

(a) on the adjudicator's own initiative; or

(b) on the application of the claimant or therespondent.

(3) If a correction is made to a determination under

this section, the authorised nominating authorityto whom the adjudication application was mademust give a copy of the corrected determination tothe claimant and the respondent and the BuildingCommission as soon as practicable after thecorrection is made.

(4) An adjudicator cannot make a correction of adetermination under this section if an applicationhas been made under Division 2A for a review ofthe determination.

* * * * *

s. 24

S. 24(3)inserted by

No. 42/2006s. 25.

S. 24(4)inserted byNo. 42/2006s. 25.

Ss 2527

repealed byNo. 42/2006s. 26.


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No. 15 of 2002

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28 Claimant may make new application if previous

application refused or not determined

(1) This section applies if

(a) a claimant fails to receive an adjudicator'snotice of acceptance of an adjudicationapplication within 4 business days after theapplication is made; or

(b) an adjudicator who accepts an adjudication

application fails to determine the applicationwithin the time allowed by section 22(4).

(2) In either of those circumstances, the claimant

(a) may withdraw the application, by notice inwriting served on the adjudicator or theauthorised nominating authority to whom theapplication was made; and

(b) may make a new adjudication applicationunder section 18.

(3) Despite sections 18(3)(c), 18(3)(d) and 18(3)(e), anew adjudication application may be made at anytime within 5 business days after the claimant

becomes entitled to withdraw the previousadjudication application under subsection (2).

(4) This Division applies to a new application referredto in this section in the same way as it applies toan application under section 18.

Division 2AReview of adjudication

28A Threshold for review

This Division applies in respect of an adjudicationdetermination if the adjudicated amount exceedsthe higher of

s. 28

S. 28(3)amended byNo. 42/2006s. 27.

Pt 3 Div. 2A(Heading andss 28A28L)

inserted byNo. 42/2006s. 28.



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No. 15 of 2002

42

(a) $100 000; or

(b) the amount prescribed for the purposes ofthis section.

28B Application for review by respondent

(1) Subject to this section, a respondent may apply fora review of an adjudication determination(an adjudication review).

(2) An application under this section may only be

made if the respondent provided a paymentschedule to the claimant within the time specifiedin section 15(4) or 18(2).

(3) An application under this section may only bemade on the ground that the adjudicated amountincluded an excluded amount.

(4) An application under this section may only bemade if the respondent has identified that amountas an excluded amount in the payment schedule orthe adjudication response.

(5) An application under this section may only bemade if the respondent has paid to the claimantthe adjudicated amount other than the amountsalleged to be excluded amounts.

(6) An application under this section may only bemade if the respondent has paid the allegedexcluded amounts into a designated trust account.

28C Application for review by claimant

(1) Subject to this section, a claimant may apply for a

review of an adjudication determination(an adjudication review).

(2) An application under this section may only bemade on the ground that the adjudicator failed totake into account a relevant amount in making anadjudication determination because it waswrongly determined to be an excluded amount.

S. 28Binserted byNo. 42/2006s. 28.

S. 28Cinserted byNo. 42/2006s. 28.

s. 28B


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28D Procedure for making application

(1) An adjudication review application must be madeto the authorised nominating authority to whichthe adjudication application was made.

(2) An adjudication review application must be madewithin 5 business days after the respondent orclaimant (as the case requires) receives a copy ofthe adjudication determination.

(3) An adjudication review application(a) must be in writing in the prescribed form

(if any); and

(b) must contain the prescribed information(if any); and

(c) must be accompanied by the application fee(if any) determined by the authorisednominating authority.

(4) The applicant must give a copy of the adjudication

review application to the other party to theadjudication review within one business day afterthe application is made.

(5) The authorised nominating authority must as soonas practicable after receiving an adjudicationreview application give a copy of the applicationto

(a) the adjudicator who made the adjudicationdetermination that is the subject of theadjudication review; and

(b) the Building Commission.

28E Right to make submissions

A party to an adjudication review may make asubmission to the authorised nominating authorityin response to the application for review within3 business days after being given a copy of theadjudication review application.

S. 28Dinserted byNo. 42/2006s. 28.

S. 28Einserted byNo. 42/2006s. 28.

s. 28D


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28F Designated trust account

(1) On paying money into a designated trust accountin accordance with section 28B, the respondentmust give the claimant notice of that paymenttogether with particulars identifying the accountand the recognised financial institution with whichthe account is kept.

(2) Subject to subsection (3), money held in adesignated trust account (including any interestaccruing to that money) is taken to be held on thefollowing trusts

(a) to the extent to which the money is requiredto satisfy the claimant's entitlements, themoney is to be applied in satisfaction ofthose entitlements;

(b) to the extent to which any of the moneyremains in the account after the claimant'sentitlements have been fully satisfied, themoney is to be paid to the respondent.

(3) If the respondent withdraws the adjudicationreview application in accordance with section28K, any money held in a designated trust account(including any interest accruing to that money) isto be paid to the claimant.

(4) Subject to subsections (2) and (3), the regulationsmay make provision for or with respect to theestablishment and operation of designated trustaccounts.

(5) In this section, claimant's entitlements, in relationto money held in a designated trust account,means the amount (if any) to which the claimant

becomes entitled under a review determination.

S. 28Finserted byNo. 42/2006s. 28.

s. 28F


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28G Appointment of review adjudicator

(1) The authorised nominating authority must, within5 business days after receiving an application forreview, appoint a review adjudicator inaccordance with this section (the reviewadjudicator) to conduct the review.

(2) A review adjudicator must be a person who iseligible to be an adjudicator as referred to insection 19.

(3) The authorised nominating authority may notappoint an adjudicator who has been involveddirectly or indirectly with the adjudicationdetermination that is the subject of theadjudication review.

(4) The authorised nominating authority must giveeach party to the review and the BuildingCommission written notice of the appointment ofa review adjudicator.

(5) The notice under subsection (4) must include thedate of the appointment.

28H Adjudication review procedures

(1) The adjudication review commences uponacceptance by the review adjudicator of his or herappointment as the review adjudicator.

(2) The authorised nominating authority must providethe following information to the reviewadjudicator as soon as practicable after theappointment of the review adjudicator

(a) a copy of the adjudication reviewapplication; and

(b) a copy of any submission made by a party tothe adjudication review in accordance withsection 28E; and

S. 28Ginserted byNo. 42/2006s. 28.

s. 28G

S. 28Hinserted byNo. 42/2006s. 28.


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(c) a copy of the adjudication determination thatis the subject of the adjudication review; and

(d) a copy of the payment claim that relates tothat adjudication determination; and

(e) a copy of each submission considered by theadjudicator who made that adjudicationdetermination; and

(f) a copy of the payment schedule (if any)

considered by the adjudicator who made thatadjudication determination; and

(g) any other information that the adjudicatorwho made the adjudication determinationconsidered in making that determination.

28I Adjudication review determination

(1) A review adjudicator is not to determine anadjudication application until after the end of the

period within which any party to the adjudicationreview may make a submission in accordance

with section 28E.

(2) In determining an adjudication review application,the review adjudicator must consider thefollowing matters and those matters only

(a) the provisions of this Act and any regulationsmade under this Act; and

(b) the provisions of the construction contractfrom which the application arose; and

(c) the information provided by the authorised

nominating authority under section 28H.

(3) In determining an adjudication review application,the review adjudicator must not take intoaccount

S. 28Iinserted byNo. 42/2006s. 28.

s. 28I


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(a) any excluded amount; or

(b) any other matter that is prohibited by thisAct from being taken into account.

(4) A review adjudicator's determination is void

(a) to the extent that it has been made incontravention of subsection (2); or

(b) if it takes into account any amount or matterreferred to in subsection (3), to the extent

that the determination is based on thatamount or matter.

(5) After conducting an adjudication review, a reviewadjudicator may

(a) substitute a new adjudication determination(the review determination) for thedetermination that is the subject of theadjudication review; or

(b) confirm the determination that is the subject

of the adjudication review.(6) In determining an adjudication review, the review

adjudicator must

(a) specify if the review determination varies theadjudication determination and how it variesthe adjudication determination; and

(b) specify any amounts paid to the claimant bythe respondent in respect of the adjudicationdetermination; and

(c) determine any further amount that is to bepaid by the respondent to the claimant; and

(d) determine any amount that is to be repaid bythe claimant to the respondent; and

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(e) determine any interest payable in accordancewith section 12(2) on an amount referred toin paragraph (c); and

(f) specify the date on which an amount underparagraph (c), (d) or (e) becomes payable.

(7) A review determination must be in writing and setout the reasons for the review determination inthat determination.

(8) A review adjudicator who makes a reviewdetermination may, if he or she thinks itappropriate, include a statement in the reviewdetermination that in his or her opinion theapplication for the adjudication review was notmade in good faith.

(9) The date for payment referred to in subsection(6)(f) must be 5 business days after the respondentor claimant (as the case requires) is given a copyof the review determination.

(10) The review adjudicator must complete theadjudication review and provide a copy of thereview determination to the authorised nominatingauthority that appointed him or her

(a) within 5 business days after his or herappointment; or

(b) within any further time, not exceeding10 business days after that appointment, towhich the applicant for the adjudicationreview agrees.

(11) An applicant must not unreasonably withholdtheir agreement under subsection (10)(b).

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28J Authorised nominating authority must notify

persons of review determination

The authorised nominating authority must, as soonas practicable, provide a copy of the reviewdetermination to

(a) each party to the adjudication review; and

(b) the adjudicator who made the adjudicationdetermination that is the subject of the

adjudication review; and(c) the Building Commission.

28K Withdrawal of adjudication review application

An applicant may withdraw an adjudicationreview application at any time before the reviewadjudicator has made a review determinationunder section 28I by serving a notice ofwithdrawal on

(a) the review adjudicator; and

(b) the authorised nominating authority thatappointed the review adjudicator; and

(c) the other party to the adjudication review.

28L Correcting mistakes in review determinations

Section 24 applies to review determinations as if areference in that section

(a) to an adjudicator were a reference to areview adjudicator; and

(b) to a determination made by an adjudicatorwere a reference to a review determination.

S. 28Jinserted byNo. 42/2006s. 28.

S. 28Kinserted byNo. 42/2006s. 28.

s. 28J

S. 28Linserted byNo. 42/2006s. 28.


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Division 2BPayment and recovery of adjudicated amounts

28M Respondent required to pay adjudicated amount

(1) Subject to sections 28B and 28N, if an adjudicatordetermines that a respondent is required to pay anadjudicated amount, the respondent must pay that

amount to the claimant on or before the relevantdate.

(2) In this section relevant date means

(a) the date that is 5 business days after the dateon which a copy of the adjudicationdetermination is given to the respondentunder section 23A; or

(b) if the adjudicator determines a later dateunder section 23(1)(b), that later date.

28N Payment after review determination(1) If the respondent is required by a review

determination to pay an amount to the claimant,the respondent must pay that amount on or beforethe date for that payment determined by thereview adjudicator under section 28I(6)(f).

(2) If the claimant is required by a reviewdetermination to pay an amount to the respondent,the claimant must pay that amount on or beforethe date for that payment determined by the

review adjudicator under section 28I(6)(f).

Pt 3 Div. 2B(Heading andss 28M28R)inserted byNo. 42/2006s. 28.

S. 28Minserted byNo. 42/2006s. 28.

s. 28M

S. 28N

inserted byNo. 42/2006s. 28.


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28O Consequences of respondent not paying adjudicated

amount

(1) If the respondent fails to pay the whole or any partof an adjudicated amount in accordance withsection 28M or 28N, the claimant may

(a) request the authorised nominating authorityto whom the adjudication application or theadjudication review application was made to

provide an adjudication certificate undersection 28Q; and

(b) serve notice on the respondent of theclaimant's intention

(i) to suspend carrying out constructionwork under the construction contract;or

(ii) to suspend supplying related goods andservices under the constructioncontract.

(2) A notice under subsection (1)(b) must state that itis made under section 28O(1) of this Act.

(3) A notice cannot be served under subsection (1) inrespect of a failure to pay the whole or any part ofan adjudicated amount in accordance withsection 28M until after the end of the periodallowed for making an adjudication reviewapplication under section 28D.

(4) If the claimant has made an adjudication reviewapplication in respect of any part of theadjudicated amount, the claimant may not give anotice under subsection (1)(b) in respect of afailure to pay that adjudicated amount inaccordance with section 28Muntil thatadjudication review is completed.

S. 28Oinserted byNo. 42/2006s. 28.

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(5) In this section adjudicated amountincludes anyamount payable by the respondent under a reviewdetermination.

28P Consequences of claimant not paying adjudicated

amount

If the claimant fails to pay the whole or part of theamount payable by the claimant under a reviewdetermination in accordance with section 28N, therespondent may request the authorised nominatingauthority to which the adjudication reviewapplication was made to provide an adjudicationcertificate under section 28Q.

28Q Adjudication certificates

(1) An adjudication certificate provided by anauthorised nominating authority on a requestunder this Division must state that it is madeunder this Act and specify the following matters

(a) the name of the person requesting the

certificate;(b) the name of the person who is liable to pay

the adjudicated amount;

(c) the amount payable under section 28Mor 28N;

(d) the date on which payment of that amountwas due to be paid to the person requestingthe certificate.

(2) If any amount of interest that is due and payable

on the amount payable under section 28M or 28Nis not paid by the respondent, the personrequesting the adjudication certificate may requestthe authorised nominating authority to specify theamount of interest payable in the adjudicationcertificate.

S. 28Pinserted byNo. 42/2006s. 28.

s. 28P

S. 28Qinserted byNo. 42/2006s. 28.


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(3) If an amount of interest is specified in theadjudication certificate to be paid by therespondent, the amount is to be added to, and

becomes part of, the adjudicated amount.

(4) If the claimant has paid the respondent's share ofthe adjudication fees in relation to the adjudicationor the adjudication review fees in relation to anyadjudication review (as the case requires) but hasnot been reimbursed by the respondent for that

amount (the unpaid share), the claimant mayrequest the authorised nominating authority tospecify the unpaid share in the adjudicationcertificate.

(5) If the respondent has paid the claimant's share ofthe adjudication review fees in relation to anyadjudication review but has not been reimbursed

by the claimant for that amount, the respondentmay request the authorised nominating authorityto specify that share of the fees in the adjudication

certificate.(6) If the unpaid share is specified in the adjudication

certificate it is to be added to, and becomes partof, the adjudicated amount.

(7) In this section adjudicated amountincludes anamount payable by the respondent or the claimantunder a review determination.

28R Proceedings to recover amount payable under

section 28M or 28N

(1) If an authorised nominating authority hasprovided an adjudication certificate to a personunder section 28Q, the person may recover as adebt due to that person, in any court of competent

jurisdiction, the unpaid portion of the amountpayable under section 28M or 28N.

s. 28R

S. 28Rinserted byNo. 42/2006s. 28.


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(2) A proceeding referred to in subsection (1) cannotbe brought unless the person provided with theadjudication certificate files in the court

(a) the adjudication certificate; and

(b) an affidavit by that person stating that thewhole or any part of the amount payableunder section 28M or 28N has not been paidat the time the certificate is filed.

(3) If the affidavit indicates that part of the amountpayable under section 28M or 28N has been paid,judgment may be entered for the unpaid portion ofthat amount only.

(4) Judgment in favour of a person is not to beentered under this section unless the court issatisfied that the person liable to pay the amount

payable under section 28M or 28N has failed topay the whole or any part of that amount to thatfirst-mentioned person.

(5) If a person commences proceedings to have thejudgment set aside, that person

(a) subject to subsection (6), is not, in thoseproceedings, entitled

(i) to bring any cross-claim against theperson who brought the proceedingsunder subsection (1); or

(ii) to raise any defence in relation tomatters arising under the constructioncontract; or

(iii) to challenge an adjudicationdetermination or a reviewdetermination; and

(b) is required to pay into the court as securitythe unpaid portion of the amount payableunder section 28M or 28N pending the finaldetermination of those proceedings.

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(6) Subsection (5)(a)(iii) does not prevent a personfrom challenging an adjudication determination ora review determination on the ground that the

person making the determination took intoaccount a variation of the construction contractthat was not a claimable variation.

(7) A claimant may not bring proceedings under thissection to recover an adjudicated amount under anadjudication determ

building & construction industry act 2002

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