S+P Walters is a commercial law firm servicing clients across Lismore, Ballina, Byron Bay, Casino and the greater Northern Rivers.
The firms provides advice to individuals and business on all kinds of transactional work – from leasing, domestic conveyancing and setting up partnerships, to drafting and advising on commercial agreements or administering large block residential subdivisions – with the kind of accessible expertise and in depth knowledge that only a local firm can provide.
Security of Payment Act & Residential Building Works
On 1 March 2021, there were some important changes to the Building and Construction Industry Security of Payment Act 1999 (NSW) (“Security of Payment Act”) that affect owner occupier construction contracts (i.e. home building contracts). These types of contracts relate to building work done to residential properties where the person who engages the builder resides or proposed to reside in the dwelling. The changes only apply to construction contracts entered on or after 1 March 2021.
When a builder makes a “payment claim” under the Security of Payment Act to the homeowner, if the contract fails to expressly outline when the progress payments become due and payable, payment should be made 10 business days after the payment claim was made.
However, a homeowner who has been served with a payment claim may respond by providing the builder with a “payment schedule”. The strict timeframes for the homeowner to provide a payment schedule are:
within the time outlined in the contract, or within 10 business days after the payment claim is served, (whichever is earlier). Penalties apply if the homeowner does not pay the building contractor on time, which include suspension of the construction work and interest payable on the unpaid amount of a progress payment.
From 26 June 2021, it will be mandatory for all construction contracts with a value of over $20,000 to contain the Security of Payment Guide. Fines apply to relevant contracts for failure to do so.
If you need assistance with a Security of Payment issue, please contact Solicitor, Clint Braid at our firm on 6621 8833 or email clint.braid@spwalters.com.au
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