The tide turns towards Builders – Security of Payment Act 1999
On 1 September 2020 the Building and Construction Security of Payment Regulation 2020 (Regulation) commenced, bringing with it a raft of changes to the already heavily amended Building and Construction Security of Payment Act 1999 (SoPA).
Of particular relevance to my readers will be the amendment that removes the previous owner-occupier exemption from claims by builders under SoPA. Claims can now be made from 1 March 2021 and by builders against owners in relation to contracts for residential building work 2020 entered into after 1 September 2020. Prior to the amendment, sub-contractors were able to make SoPA claims against the builder, but the builder could not seek that same relief, leading in some cases to financial disadvantage.
The amendment benefits builders by offering them a quicker and cheaper alternative to recovery of unpaid fees at NCAT. The Regulation also introduces qualification and eligibility requirements for adjudicators to improve the quality of determinations.
Supporting statements are now only required for sub-contractors or suppliers directly engaged by the head contractor.
SoPA is highly prescriptive in terms of content and timing of claims, responses, and adjudication applications.
As a result, Builders and Owners alike should approach such claims and responses with care.
Do you need advice regarding the Security of Payment Act 1999?
Clare Peacock is an experienced construction lawyer working on Sydney’s Northern Beaches. Clare provides practical, cost-effective building approval advice to property owners, builders and strata managers. Services include residential building disputes, body corporate issues and strata building problems.