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.
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.