A discussion paper seeking feedback on the operation of the
Building and Construction Industry Payments Act 2004
(BCIPA) has been released by the Minister for Public Works and
Housing, the Hon Tim Mander.
Partner Adam Carlton-Smith and special counsel Charles Sullivan
outline some of the issues posed by the paper, and the possible
consequences that could result.
The discussion paper poses a total of 20 questions to which
interested parties including industry stakeholders, head
contractors, subcontractors and suppliers are invited to
The deadline for providing submissions and comments is 22
HopgoodGanim will be making a submission in response to the
discussion paper, and welcomes feedback from any interested parties
on both the discussion paper and BCIPA generally.
Questioning the operation of BCIPA
The questions posed by the discussion paper include the
Should the jurisdiction of BCIPA be reduced to specifically
exclude payment claims for some types of work, or work over a
stated value? If so, what should be excluded?
Should BCIPA allow other types of payment claims, including
claims by purchasers, to be subject to adjudication?
Should the type of payment claims allowed under BCIPA be
restricted? If so, should payment claims be restricted to:
contract price for the work;
any other rates or prices stated in the contract;
any variation agreed to by the parties of the contract by which
the contract price, or any other rate of price stated in the
contract, is to be adjusted by a specific amount; or
the estimated cost of rectifying any defects in the work?
Do you believe BCIPA allows those who carry out construction
work or supply related goods and services to serve large and
complex payment claims in an untimely and unfair manner?
Should BCIPA allow claimants, at the lodgement of an
adjudication application, to place a charge on monies owing to a
respondent head contractor by a principal?
Do you believe that some respondents are misusing the legal
process by commencing Supreme Court proceedings to delay the
payment of an adjudicated amount?
The purpose of BCIPA: Cash flow vs dispute
The questions posed, and the paper as a whole, certainly deserve
consideration by all participants in Queensland's construction
industry. A critical issue to consider is whether the purpose of
BCIPA is to provide a quick method to ensure payment to enable cash
flow to continue, or whether its purpose is to provide an
alternative form of dispute resolution. The title of the discussion
paper perhaps gives a clue as to the where the current thinking of
the Government lies on this issue.
At the time that BCIPA was passed by the Queensland Parliament
(11 May 2004), the legislation was seen by the then-Minister as
directly addressing issues of non-payment and was touted to
"make a significant difference to the working and payment
culture of the building and construction industry."
The Minister also promised to "progressively and
incrementally continue to tighten the noose around the necks of the
undesirables in the industry and continue to provide weapons of
mass destruction to the subcontractors where possible."
It remains to be seen whether the current discussion paper will
result in a further tightening of the noose. Alternatively, if the
process under BCIPA is made more complex, will its effectiveness be
reduced, resulting in a loosening of the noose?
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