Security of Payment changes are here

The Queensland Government has just announced that on 1 July 2018 the modified process for Security of Payment in Queensland under the Building Industry Fairness (Security of Payment) Act 2017 (‘BIF’) will be in full effect.

Under the BIF the modified regime will mean:

1. Payment claims no longer need to be endorsed (a recipient must assume each claim is a statutory claim);

2. Claimants will have longer to submit an adjudication application in most situations; and

3. Respondents must issue a prompt payment schedule within the ‘response period’ or they will become liable to pay the full amount claimed (no more “second chances”).

This announcement provides much needed clarity on the date of this key milestone in the overall suite of legislative reform for Security of Payment in Queensland.

Phase 1 of the new Project Bank Account (PBA) model commenced today and the wider rollout of the PBAs to the industry is still on track for 1 January 2019.

Together, the changes mean the playing field for Principals and Contractors alike has changed significantly. Administration of contracts in accordance with the new legislative requirements will become a focal point for projects delivery.

Note that all payment claims submitted before 1 July 2018 must be endorsed as made under the Building and Construction Industry Payments Act 2004.

For more information, please contact Peter Lamont.