Marino Law has extensive experience in a wide variety of building and construction disputes including:
- matters under the BCIPA (Building and Construction Industry Payments Act 2004 (Qld))
- matters relating to the Queensland Building and Construction Commission (formerly the Queensland Building Services Authority QBSA)
- disputes relating to the construction of homes
- disputes relating to the construction of commercial buildings and civil infrastructure
- disputes relating to variations, extensions of time, retentions, and liquidated damages
- disputes between subcontractors and principal contractors
- matters under the Subcontractors’ Charges Act 1974 (Qld)
- matters under the Domestic Building Contracts Act 2000 (Qld)
- contract review
- Court and Tribunal appearances
- debt recovery
Historically, it has been the sub-contractor which is left exposed and unpaid when building and construction disputes arise. However, the introduction of the Subcontractors’ Charges Act 1974 (Qld) and more recently, the Building and Construction Industry Payments Act 2004 (Qld), has afforded sub contractors and contractors alike greater ability to recover payment for services rendered.
In essence these two statutory instruments cater for the needs of subcontractors in vastly different ways. The Subcontractors’ Charges Act provides that both options cannot be pursed at once. It is therefore important that you obtain urgent legal advice as to which option best serves your needs.
Subcontractors’ Charges Act 1974 (Qld)
The Subcontractors’ Charges Act is extremely powerful legislation which sub contractors can use to secure moneys owed to it by a head/superior contractor from the head/superior contractor’s principal (“employer”).
The effect of the charge is to take moneys due from the employer to the head/superior contractor out of circulation, to be earmarked for payment to the sub contractor. As you can appreciate the sub contractor does not have a contract with the employer, but the effect of this Act is that the sub contractor may get the money directly from the employer in certain circumstances.
The employer is obliged by the Act to retain the charge moneys, and if they fail to do so they are personally liable to pay its claim, not exceeding the amount that the employer was obliged to retain. The sub contractor lodging the charge (and any other sub contractors) become secured creditors for these monies retained by the employer, even against a liquidator of a head contractor.
It can have a devastating effect on the head contractor’s cash flow, so the sub contractor must have a justifiable basis for lodging a sub contractor’s charge. If a sub contractor vexatiously or without reasonable grounds lodges a subcontractor’s charge, a court can award damages to a person prejudicially affected by an unjustified lodgment of the subcontractor’s charge, which the sub contractor would be required to pay.
The sub contractor does not always receive all the monies it claims, particularly in cases where the head contractor has already gone or later goes into liquidation or the amount owed to the contractor is less than the amount of the sub contractor’s claim. However, the subcontractor benefits by at least getting some monies which otherwise are likely to be unavailable to them in liquidation.
Given the complexities of building and construction disputes and this Act, it is imperative you obtain urgent legal advice to ensure you seize on the opportunities and benefits the Act affords sub-contractors.
Building and Construction Industry Payments Act 2004 (Qld))
The Building and Construction Industry Payments Act 2004 (Qld) (BCIPA) applies to anyone who is a party to a contract for construction or the supply of related goods or services.
With its strict time limits and severe consequences, special care must be taken to ensure any payment claim or document served on you is responded to swiftly and correctly or you could be left with a judgment debt and no defence as to why payment should not be made.
BCIPA allows participants involved in a construction payment dispute to have the dispute decided by a registered adjudicator as an alternative to the court process.
BCIPA grants a person who undertakes construction work a statutory entitlement to recover progress payments in certain situations.
A construction contract is a contract for construction work or the supply of related goods or services. The contract can be written, oral, partly written and partly oral.
Construction work includes the construction of buildings or structures, the installation in any building or structure of fittings, external or internal cleaning of buildings or structures, preparatory work or work performed to complete construction.
Related goods or services includes materials and components that will form part of any building or structure, plant or materials used in construction, the provision of labour to carry out construction and architectural, surveying, engineering, interior or exterior decoration and landscape advisory services.
Typically, contracts affected by BCIPA may include:
- claims by contractors against principals/developers
- claims by subcontractors against contractors
- claims by plant and equipment hirers against subcontractors/contractors
- claims by consultants against clients
Contracts which are excluded from the operation of BCIPA include:
- a contract which forms part of a loan agreement, guarantee or contract or insurance
- domestic building contracts where the owner is a resident owner
- a contract where the amount to be paid is not calculated based on the value of work done
Under the Act, a person entitled to a progress payment (claimant) may serve a payment claim on the party liable to pay the amount (respondent).
The effect of submitting a payment claim is that the respondent must either:
- respond to the payment claim by providing a payment schedule, indicating the amount of the payment (if any) they propose to make within the prescribed period, or
- pay the whole of the claimed amount on or before the due date for the progress payment to which the payment claim relates
BCIPA contains specific requirements as to the form, content and timing of service of either a payment claim or payment schedule. Failure to adhere to the strict timeframes and requirements of BCIPA could mean that you are forced to pay the full amount on a payment claim without the opportunity to respond, defend or appeal.
Whether you are a sub-contractor, contractor, principal, builder, owner builder, developer or consultant faced with a building dispute or construction dispute, our team of experienced building and construction dispute litigation lawyers and accredited mediators can assist you through every step of the process.