December 3, 2021
Welcome to the December edition of Projects & Construction Monthly.
This edition addresses:
- the Christmas and New Year shutdown period;
- the next stage of project trust accounts;
- recent major projects;
- LPC Lawyers’ current ‘The Administrator’
Christmas Checklist: Check Your Contracts!
The Christmas and New Year shutdown period is fast approaching and for those in the building and construction industry, contractual deadlines do not stop. Those involved in construction projects are reminded to check their contracts for potential issues and ensure they are aware of any payment obligations over the break.
Whilst every contract will vary, there are a few key things to look out for:
- Days/Business Days/Working Days – review contract definitions and determine whether a timeframe refers to “days” or “business days” or “working days”.
- Delays and Extension of Time (‘EOT’) – if you are experiencing or expecting delays, or require an EOT, ensure you provide notifications in accordance with contractual timeframes. Usually, the Christmas shutdown period can only be claimed as a delay if ongoing works were not reasonably foreseen when signing the contract.
Further, building and construction industry participants are reminded to be aware of the ‘Christmas blackout period’ on the timeframes in which participants must apply the provisions of the Building Industry Fairness (Security of Payment) Act 2017 (BIF Act).
For this Christmas/New Year period, the Christmas blackout period under the BIF Act will run from Wednesday, 22 December 2021 through until Monday, 10 January 20212 (inclusive). This means that timeframes under the BIF Act will not run between these dates as those days are not considered a “business day” under the BIF Act.
As such, industry participants are encouraged to consider all significant deadlines, including due dates for payment and the delivery of payment claims and payment schedules to ensure they are not affected by the blackout period.
Project trust accounts: Queensland’s next stage goes live
On 1 January 2022, the new project trust account regime is due to enter its next phase (Phase 2B). From this date, the requirement for project trusts will be extended to the private sector, local government, statutory authorities and Government owned corporations’ eligible contracts worth $10 million or more.
All principals, head contractors and subcontractors should carefully consider how current financial and project administration procedures will be adapted to ensure compliance and a smooth transition to this regime. See the Project and Retention Trust Account Timeline below and read more about each phase here.
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Recent Major Projects
North East Link
The Victorian Government has awarded a major $11.1 billion contract to Spark Consortium to build, operate and maintain the tunnels of Melbourne’s North East Link project for 25 years.
The project will provide three-lane twin tunnels that will complete the missing link in Melbourne’s freeway network. Further, it will reduce congestion in the north-east while maintaining local roads for local trips, with up to 135,000 vehicles utilising this new public asset every day.
The project is set to be complete in 2028.
Coomera Connector
The contract for Coomera Connector Stage 1 North has been awarded to Acciona Construction Australia and Georgious Group Joint Venture, with WSP and BG&E as the designers.
Dubbed as the ‘second M1’ between Coomera and Helensvale on the Gold Coast, the Coomera Connector is a significant project that will provide long-term benefits to commuters across South East Queensland by providing an alternative north-south route that will help ease M1 congestion.
The project is estimated to cost $300-400 million with construction set to start in mid-2022.
Great Western Highway – Katoomba to Lithgow
A contract has been awarded to a joint venture of AECOM Australia and Aurecon Australasia to carry out technical investigations and detailed studies on the feasibility, and to develop a preferred concept design for the proposed 11-kilometre tunnel between Blackheath and Little Hartley.
This is the final stage in confirming whether the longest road tunnel in Australia can be delivered. If given the go ahead, the tunnel will provide double the capacity for all motorists driving to and from the Central West.
The 11-kilometre tunnel would be the final stage of the Great Western Highway upgrade between Katoomba and Lithgow, with the first stage set to start in late 2022.
LPC Lawyers’ ‘The Administrator’ Series
Contract Administrator 2
LPC Lawyers is currently mid-way through the publication of a four-part series on all things relative to contract administration.
‘The Administrator’ – Part 1
The first part of the series explores the core skills of an effective contract administrator and tips to avoid major project litigation. Read more here.
‘The Administrator’ – Part 2
Part two explores the four stages of contract administration in construction projects and provide a checklist for contract administration best practice. Read more here.
‘The Administrator’ – Part 3
The third part of the series explores the root causes for contract administration problems and how to avoid them. Read more here.
‘The Administrator’ – Part 4 – COMING SOON
Part 4 will explore how to assess the performance of the contract administrator. COMING SOON.