CONTRIBUCIÓN DE LA MATERIA A LAS COMPETENCIAS CLAVE

2.36. The NSW Act provides for a statutory right to progress payment alongside the existing contractual right through a strict and quick statutory procedure. A person who has undertaken to carry out construction work under the contract, or who has undertaken to supply related goods and services under the contract, is entitled to a progress payment on and from each ‘reference date’ under a construction contract.¹³⁴ The ‘reference date’ means a date determined in accordance with the

132 Machkevitch v Andrew Building Construction [2012] NSWSC 546, [29] (McDougall J).

133 Machkevitch v Andrew Building Construction [2012] NSWSC 546, [51] (McDougall J).

134 NSW Act, s 8(1).

45 terms of the contract as the date on which a claim for a progress payment may be made in relation to work carried out or undertaken to be carried out.¹³⁵ This indicates that the parties are not prohibited by the NSW Act from limiting the occurrence of reference dates in their construction contract. However, if the contract is silent about the ‘reference date’; it is the last day of the named month in which the construction work was first carried out under the contract and the last day of each subsequent named month.¹³⁶ The claimant can only make one claim for each reference date.¹³⁷ However, if money has not been paid for a previous claim, it can be included in the next claim. Where reference dates are provided in a construction contract, and the contract does not provide that the reference dates will survive termination of the contract, then termination of the contract may extinguish all future reference dates.¹³⁸

2.37. The statutory adjudication mechanism starts when a person who claims to be entitled to a progress payment (the claimant) serves a valid payment claim on the person who, under the construction contract concerned, is or may be liable to make that payment in accordance with the legislative guidelines (the respondent).¹³⁹ The claim must be served within the period determined by the terms of the construction contract or the period of 12 months after the construction work to which the claim relates was last carried out, whichever is the latter.¹⁴⁰ A payment claim under the NSW Act can be made at the same time as a progress payment claim under the contract.¹⁴¹ The respondent can reply to the claim by providing a payment schedule to the claimant which must identify the payment claim to which it relates and indicate the amount of the payment (if any) that the respondent proposes to make.¹⁴² If the scheduled amount is less than the claimed amount, the payment schedule must indicate why the scheduled amount is less and the respondent's reasons for withholding payment.¹⁴³ As a

135 NSW Act, s 8(2)(a).

136 NSW Act, s 8(2)(b).

137 Holdmark Developers Pty Ltd v GJ Formwork Pty Ltd [2004] NSWSC 905 [40],[41] (McDougall J)

138 Patrick Stevedores Operations No. 2 Pty Ltd v McConnell Dowell Constructors (Aust) Pty Ltd [2014] NSWSC 1413 [37],[38] (Ball J); Broadview Windows Pty Ltd v Architectural Project Specialists [2015] NSWSC 955;

Construction Claims, 3^rd edn 2013 Davenport, P and Durham, H, Federation press, Sydney, Chapter 13: Claims after termination.

139 NSW Act, s 13.

140 NSW Act, s 13 (4).

141 Leighton Contractors Pty Limited v Campbelltown Catholic Club Limited [2003] NSWSC 1103 (Einstein J).

142 NSW Act, s 14.

143 NSW Act, s 14 (3).

46 good practice, the reasons should include any jurisdictional objections concerning the validity of the payment claim or the existence of a construction contract. The payment schedule may be served by the respondent or his/her agent (i.e., the superintendent) provided that a proper delegation is made by the respondent to the agent with a clear statement that this is a respondent’s payment schedule not merely a superintendent’s certificate.¹⁴⁴ The respondent must issue a payment schedule within 10 business days or as specified in the contract whichever time expires earlier.¹⁴⁵

2.38. The NSW Act also provides for consequences of not paying the claimant where there is no payment schedule. So, if the respondent becomes liable to pay the claimed amount to the claimant as a consequence of having failed to provide a payment schedule, and fails to pay the whole or any part of the claimed amount by the due date, the claimant may: 1) recover the unpaid portion of the claimed amount from the respondent, as a debt due to the claimant, in any court of competent jurisdiction,¹⁴⁶ or 2) make an adjudication application in relation to the payment claim, and 3) may serve notice on the respondent of the claimant's intention to suspend carrying out the work.¹⁴⁷ The reason why a claimant may choose the option of adjudication rather than suing on the statutory debt is to avoid the requirement to issue a summons for the statutory debt.¹⁴⁸

2.39. Subsequently, if the claimant commences proceedings to recover the unpaid portion of the claimed amount from the respondent as a debt, judgment in favour of the claimant is not to be given unless the court is satisfied of the existence of the relevant circumstances. Also, the respondent has very limited grounds to contest liability in those proceedings. The respondent is not entitled to bring any cross-claim against the claimant or to raise any defence in relation to matters arising under the construction contract.¹⁴⁹ However, the respondent may challenge the claimant’s application in these proceedings on grounds related to

144 See, eg, Lucas Stuart v Hemmes Hermitage [2009] NSWSC 477 at [106] (McDougall J); Leighton Contractors Pty Limited v Campbelltown Catholic Club Limited [2003] NSWSC 1103 at [105] (Einstein J).

145 NSW Act, s 14 (4).

146 In NSW, courts of competent jurisdiction in which to file the adjudication certificate are: Local Court for amounts not exceeding $100,000; District Court for amounts exceeding $100,000 but not exceeding $750,000 and Supreme Court for amounts in excess of $750,000.

147 NSW Act, s 15 (1),(2).

148 Davenport, P (2010) Adjudication in the building industry, third edition, the Federation Press, p 12.

149 NSW Act, s 15 (4).

47 the validity of the payment claim.¹⁵⁰ For instance, the respondent may use

“misleading and deceptive conduct’ of the claimant as a possible defence to the consequences of failing to provide a payment schedule within the relevant timeframe, notwithstanding the fact that the NSW Act does not require the payment claim to be served in a good faith nor having a genuine belief in the claimant’s entitlement to do so.¹⁵¹