Introduction to the Security of Payments Act 1999

Prime Collections – Introduction to the Security of Payments Act
1999, NSW

November 12th, 2010

Payment schedules

Payment schedules   (1) A person on whom a payment claim is served
(the    ”respondent”) may reply to the claim by providing a payment
schedule to the claimant.  (2) A payment schedule: (a) must identify
the payment claim to which it relates, and  (b) must indicate the
amount of the payment (if any) that the respondent -
http://cts.vresp.com/c/?PrimeCollectionsPtyL/f215e77881/TEST/7e56a91fc3 proposes to make (the    ”scheduled amount”).  (3) If the scheduled
amount -
http://cts.vresp.com/c/?PrimeCollectionsPtyL/f215e77881/TEST/b2f43b8a6e is less than the claimed amount, the schedule must indicate why the
scheduled amount -
http://cts.vresp.com/c/?PrimeCollectionsPtyL/f215e77881/TEST/a54c62b9ab is less and (if it is less because the respondent -
http://cts.vresp.com/c/?PrimeCollectionsPtyL/f215e77881/TEST/b7884e494a is withholding payment for any reason) the respondent -
http://cts.vresp.com/c/?PrimeCollectionsPtyL/f215e77881/TEST/09b62d531c ’s reasons for withholding payment.  (4) If: (a) a claimant serves
a payment claim on a respondent -
http://cts.vresp.com/c/?PrimeCollectionsPtyL/f215e77881/TEST/44c2fc8f92 , and  (b) the respondent -
http://cts.vresp.com/c/?PrimeCollectionsPtyL/f215e77881/TEST/30cf426767 does not provide a payment schedule to the claimant: (i) within the
time required by the relevant construction contract, or  (ii) within
10 business days after the payment claim is served, whichever time
expires earlier, the respondent -
http://cts.vresp.com/c/?PrimeCollectionsPtyL/f215e77881/TEST/3a7bf5d429 becomes liable to pay the claimed amount to the claimant on the due
date for the progress payment to which the payment claim relates.

some useful links For general information about the Building and
Construction Industry Security of Payment Act 1999 (NSW)
http://cts.vresp.com/c/?PrimeCollectionsPtyL/f215e77881/TEST/84f37f777f For general information about the Building and Construction
Industry Payment Act 2004 (QLD)

http://cts.vresp.com/c/?PrimeCollectionsPtyL/f215e77881/TEST/f67151fe6d
http://cts.vresp.com/c/?PrimeCollectionsPtyL/f215e77881/TEST/962def0dd3
http://cts.vresp.com/c/?PrimeCollectionsPtyL/f215e77881/TEST/fdf4c0022c For general information about the Building and Construction
Industry Payment Act (Victoria)

http://cts.vresp.com/c/?PrimeCollectionsPtyL/f215e77881/TEST/95de8047fd Prime Collections preferred Authorised Nominating Authority,
Adjudicate Today:

http://cts.vresp.com/c/?PrimeCollectionsPtyL/f215e77881/TEST/1529fd0939 – http://

Hi Valued Customer,
We thank you for your continued support and look forward to writing
the next email in this issue of reviewing the Security of Payment
Act.  Remember we are here to help, please call our office on 1300
577 463. Call us now for an obligation free consultation.

Regards
Jason Pestano – Director

Building and Construction Industry Security of Payment Act 1999

The Act and What it Means to You?
The “Act”, “BCSPA” or “SOPA”, whatever you call it…the object of
the NSW Government’s Building and Construction Industry  Security
of Payment Act 1999 No 46 (and the respective and similar  Queensland
Act) is to ensure that any person who carries out  construction work
or provides goods and services under a construction  contract is
entitled to make progress Payment Claims and receive payment  every
month, even where the contract has no provision for progress
payments. The Act also assists in obtaining final payment and release
of  retention money. The Security of Payment Act is created to allow
the  supplier of goods and services to be paid in good time for the
works  done as per the agreement or contract. Definitions Adjudicator
in  relation to an adjudication application, means the person
appointed in  accordance with this Act to determine the application.
Authorised  Nominating Authority means a person authorised by the
minister under  Section 28 to nominate persons to determine
adjudication applications.  Claimant means a person by whom a payment
claim is served under Section  13. Construction Contract means a
contract or other arrangement under  which one party undertakes to
carry out construction work, or to supply  related goods or services,
for another party. Respondent means a person  on whom a payment claim
is served under Section 13. Scheduled Amount  means the amount of a
progress, final or retention payment that is  proposed to be made
under a payment schedule, as referred to in Section  14.

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Payment claims

(1) A person referred to in section 8 (1) who is or who claims to be
entitled to a progress payment (the    ”claimant”) may serve a
payment claim on the person who, under the construction contract
concerned, is or may be liable to make the payment.  (2) A payment
claim: (a) must identify the construction work -
http://cts.vresp.com/c/?PrimeCollectionsPtyL/f215e77881/TEST/a8c9a74e6f (or related goods and services -
http://cts.vresp.com/c/?PrimeCollectionsPtyL/f215e77881/TEST/f4ffdcedc0 ) to which the progress payment relates, and  (b) must indicate the
amount of the progress payment that the claimant -
http://cts.vresp.com/c/?PrimeCollectionsPtyL/f215e77881/TEST/d99efdd0f8 claims to be due (the    ”claimed amount”), and  (c) must state that
it is made under this Act.  (3) The claimed amount -
http://cts.vresp.com/c/?PrimeCollectionsPtyL/f215e77881/TEST/5410a56bbc may include any amount: (a) that the respondent -
http://cts.vresp.com/c/?PrimeCollectionsPtyL/f215e77881/TEST/4ff0077aa5 is liable to pay the claimant -
http://cts.vresp.com/c/?PrimeCollectionsPtyL/f215e77881/TEST/a837a7e070 under section 27 (2A), or  (b) that is held under the construction
contract by the respondent -
http://cts.vresp.com/c/?PrimeCollectionsPtyL/f215e77881/TEST/5a0c6ec941 and that the claimant -
http://cts.vresp.com/c/?PrimeCollectionsPtyL/f215e77881/TEST/24b1359b19 claims is due for release.  (4) A payment claim may be served only
within: (a) the period determined by or in accordance with the terms
of the construction contract, or (b) the period of 12 months after
the construction work -
http://cts.vresp.com/c/?PrimeCollectionsPtyL/f215e77881/TEST/161d5149ff to which the claim relates was last carried out (or the related
goods and services -
http://cts.vresp.com/c/?PrimeCollectionsPtyL/f215e77881/TEST/e65716decc to which the claim relates were last supplied), whichever is the
later.  (5) A claimant -
http://cts.vresp.com/c/?PrimeCollectionsPtyL/f215e77881/TEST/697f1ada58 cannot serve more than one payment claim in respect of each
reference date under the construction contract.  (6) However,
subsection (5) does not prevent the claimant -
http://cts.vresp.com/c/?PrimeCollectionsPtyL/f215e77881/TEST/85a3bb71da from including in a payment claim an amount that has been the
subject of a previous claim. Or click here to tell us your enquiry
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Hi Valued Customer, Inside this issue:  What is the
Security of Payment Act?  What is a Payment Claim?What is a Payment
Schedule?
Is a Payment Schedule which is signed and served by your solicitor a
valid Payment Schedule under the Act?
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useful.
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Can a solicitor or agent prepare and sign a payment schedule? -
Baulderstone Hornibrook P/L v QIC [2007] NSWCA 9

The Supreme Court was asked to consider whether, under s.14(1) of the
NSW Act, a payment schedule that had been prepared and signed by a
party’s solicitors was valid. The key issue was whether the
party’s agent had express or implied authority to prepare and
submit the payment schedule.
The courts will readily imply that a party’s agent is authorised to
prepare and deliver payment schedules on its behalf in circumstances
where the agent, normally a solicitor;
(a) has been retained to provide general legal services in relation
to the project; or
(b) has previously dealt with security of payment matters arising on
the project.
Baulderstone Hornibrook (Baulderstone) was engaged by the Queensland
Investment Corporation (QIC) to design and construct the Westpoint
Shopping Centre redevelopment. On 11 April 2006, Baulderstone served
a payment claim on QIC. The payment schedule was signed and delivered
by its solicitors, Allens Arthur Robinson (Allens), together with a
covering letter on QIC’s letterhead. Baulderstone challenged the
validity of the payment schedule on the basis that Allens’
authority under its retainer with QIC, did not extend to the
preparation and provision of payment schedules on behalf of QIC.
The NSW Court of Appeal held it could be inferred that the payment
schedule was prepared with the knowledge of, and in accordance with,
the express or implied instructions of QIC because:
(a) Allens had been engaged to provide all relevant legal services
with respect to the project, which included acting to ensure the
provisions of the Act were complied with; and
(b) at the very least, the prior conduct of Allens in providing
payment schedules on behalf of QIC on a monthly basis for 16 months
prior justified a finding of implied authority.
Source Mark Brasher

Prime  Collections
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