December 8, 2020
Under the Building Industry Fairness (Security of Payment) Act 2017 (Qld) (BIFA), a ‘business day’ does not include a Saturday or Sunday; a public holiday, special holiday or bank holiday in the place which any relevant act is to be done or may be done; or any day occurring between 22 and 24 December, 27 and 31 December, and 2 and 10 January. In other words, BIFA’s Christmas closure is from 22 December 2020 to 10 January 2021 (inclusive).
This closure is an important consideration for principal and contractor alike in preparing (and responding to) payment claims and other stages of the security of payment process under BIFA. Parties should also be aware of other public holidays, special holidays or bank holidays which are applicable under its construction contract.
The other states are not as generous with their closure periods (if any). Under the New South Wales legislation, the closure is from 25 December 2020 to 3 January 2021 (inclusive), with the first business day being Monday, 4 January 2021; however, the Victorian legislation does not provide any such closure, defining ‘business day’ as any day which is not a Saturday, Sunday, or public holiday (i.e. 25, 26 and 28 December 2020, and 1 January 2021).
Payment Claim
BIFA provides that a payment schedule given in response to a payment claim must be done so by the period specified in the contract, or within 15 business days from receipt (whichever ends earlier). Assuming a payment claim was submitted on 21 December 2020:
- if the contract does not specify a time for providing a payment schedule, under BIFA, the first business day for calculating the due date is Monday, 11 January 2021 (being the first business day following the closure under BIFA). This means any payment schedule isn’t due until Monday, 1 February 2021 (also taking into account the Australia Day public holiday); or
- if the contract does specify a time for responding to a payment claim that is less than 15 business days, that timing must be followed, including any contractual definitions of ‘business day’, ‘working day’, or ‘day’ (as the case may be) which may differ from the BIFA closure period.
It is also important to keep in mind that a payment claim may not be valid if provided before the reference date (even if requested). Generally, construction contracts may specify a separate reference date for the month of December that allows a payment claim to be submitted prior to the closure. However, if the contract merely says a payment claim is to be submitted on the 25th of each month, or is silent (meaning the reference date is the last day of each month, as specified in BIFA), the reference date will occur during the BIFA closure.
Adjudication
The security of payment and adjudication process is governed by Chapter 3 of BIFA and is subject to strict legislative timeframes (including its closure period). Whilst an adjudication application could still be lodged during this period (subject to the office hours of the QBCC), it will not be received, and the respondent’s timeframe does not commence, until 11 January 2021.
Lamont Project & Construction Lawyers
Our Team have the knowledge and experience to assist both principals and contractors with any Security of Payment or BIFA related issues. If you would like to discuss any matters raised in the above article as it relates to your specific circumstances, please contact Lamont Project & Construction Lawyers.
The contents of this article is for information purposes only; it does not discuss every important topic or change in law, and it is not to be relied upon as legal advice. Specialist advice should be sought regarding your specific circumstances.
Contact: Peter Lamont & Lili Hoelscher
Email: [email protected] & [email protected]
Phone: (07) 3248 8500
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