Important BCIPA changes passed by Parliament

Earlier this year we reported on some proposed key changes to the Building and Construction Industry Payments Act 2004 (Qld) (BCIPA) that had been presented to Parliament. The Bill that was considered was passed on 11 September 2014 and will bring into effect significant changes to the existing regime.

The Bill sets up the planned dual regime, which allows claims to be classified as ‘complex’ claims where the claim is over $750,000 or is for latent condition or a time related cost.

Other important changes include:

• A new system for complex claims under which the time for a respondent to provide a payment schedule will be extended to 15 business days.
• Time frames will be extended to 30 business days if the payment claim for a progress claim is served more than 90 days after the date in the contract on which a claim for progress payment may be made.
• The time for a respondent to provide an adjudication response will increase from five business days to 10 business days, with an extension to 15 business days for complex claims.
• In relation to complex claims, the adjudicator will be able to extend the time for an adjudication response by up to an additional 15 business days.
• The definition of ’business days’ will exclude the three business days before Christmas until 10 business days after New Year’s Day.
• The time to lodge a payment claim will be reduced from 12 months to six months after the construction work was last carried out or the period worked out under the contract, whichever is later.

In addition to these changes, the reforms will allow a respondent to complex claims to include in its adjudication response all relevant reasons for withholding payment, regardless of whether or not these matters were first raised in the payment schedule. This is an important difference between the new proposed legislation and the existing legislation.

The new provisions are due to come into effect within the coming months, so now is the time for industry players to adapt existing systems to ensure that they comply with the new requirements. Both potential claimants and respondents should make sure they know about the new changes so they can protect their respective rights in relation to progress claims.

If you would like any further information on the recent BCIPA changes or BCIPA generally, please don’t hesitate to contact us.