By Catherine Green.

 

Do you use Xero to send out your invoices? Make sure they are compliant payment claims under the Construction Contracts Act 2002 (Act).

The default payment regime under the Act is an efficient and effective way of getting your invoices paid. However, we still see contractors coming unstuck when they seek to rely on this regime because their payment claims are not compliant with the requirements of the Act.

Under section 20 of the Act, a payee (the party to a construction contract who is entitled to a progress payment) is entitled to serve payment claims on the payer (the party to a construction contract who is liable for that payment) for payments, including any single or final payment under the contract. To benefit from the default payment entitlements under the Act, a payee must first serve a valid payment claim on the payer. A valid payment claim must comply with the following mandatory requirements:

  • be in writing;
  • contain sufficient details to identify the construction contract to which the payment relates;
  • identify the construction work and the relevant period to which the payment relates;
  • state a claimed amount and the due date for payment;
  • indicate the manner in which the payee calculated the claimed amount; and
  • state that it is made under the Act.

It must also include the ‘Important Notice’ found at Schedule 1 of the Construction Contracts Regulations 2003.

To make sure you’re compliant you are welcome to use the free templates on the Building Disputes Tribunal website. You can find these in the Adjudication Guides and Resources Section. Just have a look at the Forms and Precedents. You can also find template payment schedules, notice of adjudication, a sample adjudication claim, and notices to suspend works. We update these documents regularly so if you want to be sure that you are in compliance with the latest requirements, be sure to check back to see the latest forms.

Lately we have also received a number of enquiries from contractors who are using Xero to issue their invoices and who aren’t sure how they can comply with the requirement to provide the ‘Important Notice’.

The good news is it’s pretty easy. You can add any documents as attachments to your invoice (payment claim) so you can simply include the ‘Important Notice’ as an attachment in Xero. Have a look at this easy to follow video from Xero on including files with online invoices to see how to do it.

Finally, don’t forget the other requirements under section 20 of the Act. To be a valid payment claim you need to tick all the boxes!

“Route to the decision” – Scottish court rejects challenge to adjudicator’s decision that did not expressly address a material line of defence

Written by Kate Holland In UK Grid Solutions Limited and Amey Power Services Limited v Scottish Hydro Electric Transmission PLC,[1] the unsuccessful party to an adjudication sought to resist enforcement on the grounds that 1) the adjudicator had failed to address a...

Asking a decision-maker to take a sneaky peek isn’t a strategically clever move: adjudicator’s decision held unenforceable due to breach of without prejudice rules

Written by Maria Cole A party (AZ) brought proceedings in the England and Wales Technology and Construction Court (Court) to enforce the decision of an adjudicator against the respondent (BY).[1] During the adjudication, AZ had placed without prejudice emails before...

Failed waterproofing causes a flood of costs

Written by Sam Dorne Legal battle over failed waterproofing comes to an end after plaintiffs prove their damages at the High Court in duty of care breach. Water water everywhere In the heart of Flat Bush, Auckland, stand the Nikau Apartments – a residential complex...

Mayor Brown is right about why public sector contracts go over time and over budget

Written by Rabin Rabindran and Derek Firth  In his opinion piece (NZ Herald 21 February 2024) Mayor Brown provides a number of reasons for these overruns.  They include an obsession with governance skills rather than a range of skills directly useful to the sector...

BuildLaw Issue 53

March 2024Download PDF   CONTENTS From the Editor BuildLaw in Brief A cat among pigeons Major changes to seismic building standards Failed waterproofing causes a flood of costs Asking a decisionmaker to take a sneaky peak isn’t a strategically clever...

High Court soundly dismisses judicial review of adjudication determinations but may inadvertently have put the cat among the pigeons

By Alexander Lyall In Sam Pemberton Civil Ltd v Robertson,[1] the High Court considered applications for judicial review of two related adjudication determinations. In dismissing the applications, the Court underscored some of the key functions of the Construction...

Technocratic payment regime not the priority under the Construction Contracts Act

Written by Alexander Lyall In Dem Home Ltd v New Gate Ltd[1] the High Court considered whether a payment claim had been validly served under the Construction Contracts Act 2002 (the CCA). The decision is an ever-important reminder that the CCA is designed to maintain...

Highly stressful circumstances: Court of Appeal assesses contract in earthquake insurance mess

Written by Alexander Lyall   The Court of Appeal (the Court) has issued a decision in a long-running dispute between a Christchurch homeowner and her insurance and legal advocates. Pfisterer v Claims Resolution Service Limited & Anor[1] contains a close look...

Kane v Venues NSW: The Handrail Tale

Written by Sam Dorne The case of Venues NSW v Kane [2023] NSWCA 192, involving a patron’s fall within the lower concourse of the western grandstand of the McDonald Jones Stadium in Newcastle, Australia, looks at a fundamental legal question surrounding the duty of...

How do you solve a problem like retentions?

Written by Kate Holland The use of retentions in construction contracts is culturally ingrained in the industry but it is increasingly seen as an outdated and unfair practice. In the UK, there have long been calls to abolish or regulate retentions, but little progress...
Skip to content