Knowing your contracts: Vital to success in adjudication

As crazy as it sounds, it is not uncommon for claimants to be unsure who they are contracted with. This is particularly the case with oral contracts but not exclusively so.

Furthermore, knowing exactly who you are working for takes on greater importance if your claim goes to adjudication, as you must have a clear idea of who to serve documents on and who is liable to make payment. Incorrectly identifying your contractual partner may have jurisdictional ramifications.

In a recent adjudication we found that the principal named in the contract did not actually exist. The contract contained a myriad of references to non-existing entities, incorrect ABN & ACN numbers and an incorrect QBCC license number. Additionally, a legal practice purported to represent the non-existent legal entity which raised potentially significant problems for that legal practice.

Fortunately we were able to convince the adjudicator as to who the respondent was and the adjudication decision was made wholly in the claimant’s favour.

Before signing a contract or undertaking any work it is advisable to clarify who exactly you are contracting with. This should be a relatively simple exercise and will avoid potential problems down the track.

If in doubt – seek expert assistance from Adjudicate Assist.

The due date for payment: getting it right!

Knowing your due date for payment sounds simple enough but surprisingly, many claimants calculate it incorrectly, and and are subsequently disadvantaged when their claim is disputed and they end up engaging the adjudication process.

Where to start.

The starting point for determining the due date for payment is the contract between the parties. Most standard written forms of contract will provide a specific time for payment following the service of the progress claim.

Where the contract provides a time for payment this must be read with reference to the provisions of the Building and Construction Industry Payments Act (“BCIPA”) Section 15.

This section of the legislation stipulates maximum payment terms for contractors and subcontractors to which the Queensland Building and Construction Commission (“QBCC”) Act applies.

When the Act and your contract conflict.

Where the period in the contract is in excess of the maximum permissible payment period under Section 67U (25 business days) & Section 67W (15 business days) of the QBCC Act, the payment terms default to 10 business days – the same date as the payment schedule is due for standard claims.

It doesn’t help that the definition of ‘business day’ under the QBCC Act and the BCIP Act are different (specifically the BCIP Act removes the dates between Christmas and New Years as valid business days)

Where the contract does not provide a time for payment the payment terms default to 10 business days.

When there is a valid payment terms.

Where the contract does provide a time for payment and the contract is not governed by the QBCC Act (for example: excavation, electrical work, supply of related goods and services) then the contract time for payment will apply.

Establishing the correct due date for payment is critical to serving a notice of intent to apply for adjudication (Section 20A(2) notice) under the BCIPA.

More help?

However, if you’re unsure of how to calculate the due date for payment of your payment claim, you’re welcome to contact us for assistance.

If in doubt – seek expert assistance from Adjudicate Assist.