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Common Security of Payment Act Cases

If you are curious on certain situations that are subject to the Security of Payment Act, you might just want to know the common Security of Payment Act cases that are going on around NSW. This can help you familiarise if you’re in it for a potential Security of Payment dispute.

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What is the Security of Payment Act?

The Security of Payment Act is a legislation that protects and enforces the rights of contractors, subcontractors, and suppliers around NSW. It gives them the legal right to demand payment for providing construction services. Furthermore, the Act provides them an inexpensive and faster resolution when payment disputes arise.

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What are the Rights under the Security of Payment Act?

  • Right to claim for construction work and materials provided.
  • Right to file for adjudication.
  • Right to have a fair judgment.
  • Right to suspend construction work.
Gavel and construction tools – Common Security of Payment Act Cases | Contracts Specialist

What are the Rights under the Security of Payment Act?

[Sample situation]

Mark is a 38-year-old contractor based in Sydney. He is involved in a commercial building project. He was able to finish the work ahead of the deadline agreed by him and his principal. He then issues a payment claim for the work he has done. In the contract, they agreed that a payment or a payment schedule must be issued within 10 business days since the issuance of the payment claim. However, 10 business days had passed and he hadn’t heard anything from his principal. Eventually, the principal responded with a payment schedule 3 days after the 10-day deadline, and it went on like that until the third time of claiming for construction work. This delay in payments that Mark experienced is subject to the Security of Payment Act NSW.

For Mark to make sure that he doesn’t experience this again, he may ask for legal assistance and advice from a building lawyer who has the right knowledge and experience in Security of Payments. Mark has the right to demand for payment on the date or deadline that he and his principal agreed on.

[Sample situation]

Karl is a 40-year-old subcontractor based in Sydney. He had just finished working on the electricals of a commercial building project. He issued a payment claim for the work he has done. However, his principal issued a payment schedule stating that only half of the agreed amount will be paid to him. No reasons were stated in the payment schedule. He tried to reach out to his principal to talk their situation over, but his principal was no longer contactable. This short payment case can be subject to the Security of Payment Act.

Karl may consult a construction lawyer and have his rights to pursue an adjudication enforced. He has the right to get the full amount that he and his principal agreed on in the beginning of their contract.

[Sample situation]

DJ is a 39-year-old supplier based in Sydney. He was able to provide materials for the second phase of the building project he’s in and eventually proceeds to claim for the work he has done. He issued a payment claim on their agreed reference date and expects to receive a payment or payment schedule within 10 business days. Unfortunately, after their agreed deadline, he didn’t receive anything from his principal. He tried several times to contact him, but couldn’t reach to him. This non-payment incident can be subject to the Security of Payment Act NSW.

DJ may seek the help of a legal expert specialising in building and construction to apply for adjudication. He may also consider suspending his work with his principal until he gets rightfully paid. DJ has the right to get paid for the construction work he has done and doesn’t deserve to get ripped off.

There are also other instances that can be subject to the Security of Payment Act. This can be a reference date that wasn’t stated in the contract or a variation that the principal has knowledge of and is being charged to him by the contractor. The thing is, it’s important to seek the legal advice of a construction lawyer to assess if it qualifies under the Security of Payment Act.

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Who can help with the Security of Payment Act?

Getting expert advice from a construction lawyer is completely a way forward. Recovering your debt isn’t simple. And in Australia where the building and construction industry is at its peak, you ending up unpaid is unacceptable. Don’t let your rights be stepped on. Get legal help and get paid immediately.

How can a Construction Lawyer help with Security of Payment Act?

Getting the right legal advice is always helpful. Especially for serious legal matters like payment disputes. Taking the proper steps in resolving your situation can never go wrong with the expert advice of a construction lawyer.

One of the ways to demand for payment is by writing a letter of demand. A construction lawyer can lend his/her hand to help you draft your letter of demand to the opposite party. Your lawyer can even offer to be the one to draft the letter and deliver it to the other party to demand payment on behalf of you.

It is your right as a builder to have your adjudication decision enforced. A good construction lawyer will make sure that this should be done and must ensure that you will recover your debt.

John Dela Cruz photo – Common Security of Payment Act Cases | Contracts Specialist

Contracts Specialist is a Sydney-based law firm specialising in building and construction. Our areas of expertise include Debt Recovery and the Security of Payment Act. So if you’re in a dispute right now, Contracts Specialist is here to help.

Our principal lawyer, John Dela Cruz, deals with Building Disputes, Security of Payments, and Construction Contracts day in and day out. With his extensive knowledge and over 10 years of experience in construction law, you can be confident that you are in good hands. Get paid now! Consult with Contracts Specialist.

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