With the Christmas season fast approaching, those involved in construction industry in Victoria will need to consider how to deal with payment claims and responses under the Building and Construction Industry Security of Payment Act 2002 (Vic) (SOPA) during the December/January period when your offices or sites are shut.
The SOPA does not take the Christmas shutdown period into account when calculating time. In other words, time continues to run in Victoria, unlike other States. As such, payment schedules or applications for adjudication must still be made within the time specified in the SOPA.
Recipients of payment claims are required to serve payment schedules within the time specified in the construction contract or 10 business days of receiving a payment claim, whichever is earlier.
For example, if a payment claim was validly served under the SOPA on 28 December 2020, the time for serving a payment schedule in response would be by 12 January 2021 (unless a shorter period is specified in the contract). With most of the industry shut down from 22 December 2020 until at least mid January 2021, and with people on leave, this leaves the possibility that parties may not be aware that a payment claim has been made and may only become aware after the time for a response has expired. You should be aware that the Christmas shut down period is a notorious time for ambush claims when people are away and unable to deal with claims.
A failure to respond to a payment claim made under the SOPA within time can lead to dire consequences, leaving parties exposed to having judgement entered against them and not being able to raise a defence or counterclaim to the claim. Unlike the famous Rolling Stones song – “Time may not be on your side”.
You may need to consider implementing procedures in your offices or at your sites to ensure that any claims or notices received during the shutdown period can be dealt with within time.
This may involve:
- having someone regularly checking mail including deliveries, email and faxes over the Christmas shutdown period.
- ensuring that other personnel have access to the emails of people who are away and who would normally receive payment claims.
- checking the availability of any consultants over this period who may assist in responding to a claim.
- checking the availability of any proposed Authorised Nominating Authority – that they will be available and able to appoint an adjudicator during this period.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.