Given the current economic climate, decreasing margins and increased resources to engage in disputes, there will be a logical increase in payment claims and adjudications under the Building and Construction Industry Payments Act 2004 (QLD) (BCIPA) in the forthcoming year.

Managing payments is particularly critical over the festive season where ambush tactics and a lack of resources due to holidays can lead to an influx of payment claims/adjudication applications hoping to catch out unwary respondents.

By adopting some of the strategies below you can better protect your cash flow.

  • Be prepared for claims/applications in early January. The definition of 'business day' under the BCIPA excludes public holidays and 27, 28, 29, 30 and 31 December. This means that the next business day following Christmas will be Friday, 2 January 2009.
  • Ensure that your staff, including accounts, can identify a payment claim. The critical words to be aware of are 'This is a payment claim made under the Building and Construction Industry Payments Act 2004'. A failure to respond within 10 business days (or an earlier period under the contract) with a payment schedule may mean the claim becomes a statutory debt ie you have to pay the full amount of the claim. So it is vital that payment claims are not left sitting in someone's in tray.
  • Monitor all ways in which a payment claim may be served. The methods of service of claims/applications are primarily delivering, posting or faxing to a head office, registered office or principal office. Be aware that in some circumstances adjudicators have accepted that payment claims can also be served by email, particularly if the contract allows the use of email or that has been a practice of the parties in the past. Further, fax machines need to be checked at a minimum on a daily basis for claims.
  • Staff at your registered office need to be aware of payment claims and the risk in not responding to such claims. At least one member of staff who is well informed on payment claims should man your offices during the January period.
  • If possible (and obviously subject to the contract), agree for claims to be made by no later than 24 December 2008 for the December/January period. Further, if claims can be made in January 2009, agree on the manner of service - ie agree that the claim is also to be emailed to relevant personnel, such as a site foreman or project manager, working in January 2009.

This publication is intended as a first point of reference and should not be relied on as a substitute for professional advice. Specialist legal advice should always be sought in relation to any particular circumstances and no liability will be accepted for any losses incurred by those relying solely on this publication.