The Act
Object of the Act
Gives the claimant a statutory right to make progress payment claims and receive payment, even where the contract has no provision for progress payments.
The Security of Payment Act is devised to allow the supplier of goods and services to be paid, in good time for the works done as per the agreement or contract.
The act operated with minimal success in the following years as the court system was able to be manipulated to prevent or delay payments after determinations in favour of the claimants.
The fathers of the legislation in the amendments of 2002 redressed these loopholes. These amendments have turned a well-meaning document in to a very effective law, which brings about something of a level playing field between parties trading in the construction industry.
Change is here
As many public authorities, developers, builders big and small are now discovering, The Act is changing the way they have to treat their contractors with regard to the right to proper progress payments regardless of the contract.
Deceptive conduct under the contract is no longer acceptable and more importantly not profitable way of treating their contractors and suppliers.
After listening to their constituents, politicians set about redressing these inequities by the passing of a new act of parliament in 1999 (See whole act). This became known as the Building and Construction Industry security of payments Act 1999.
- 1. The object of this Act is to ensure that any person who undertakes to carry out construction work (or who undertakes to supply related goods and services) under a construction contract is entitled to receive, and is able to recover, progress payments in relation to the carrying out of that work and the supplying of those goods and services.
- 2. The means by which this Act ensures that a person is entitled to receive a progress payment is by granting a statutory entitlement to such a payment regardless of whether the relevant construction contract makes provision for progress payments.
History
The act operated with minimal success in the following years as the court system was able to be manipulated to prevent or delay payments after determinations in favour of the claimants. The fathers of the legislation in the amendments of 2002 redressed these loopholes. These amendments have turned a well-meaning document into a very effective law, which brings about something of a level playing field between parties trading in the construction industry.
