October 23, 2020

On 23 September 2020, the Attorney General for Western Australia introduced the proposed Building and Construction Industry (Security of Payment) Bill 2020 (WA) (the Bill). If passed, the Bill will create a Security of Payment regime in Western Australia that closely aligns with the east coast model. The Bill is intended to replace the current Construction Contracts Act 2004 (WA).

The Bill introduces significant changes to the current legislation, among other things, to:

  •   set out specific detail that must be included in a payment claim, including that the claim must state it has been made under the proposed legislation;
  •   propose shorter time frames under which a party must make progress payments in response to payment claims;
  •   consequently, also propose shorter timeframes under which a payment schedule must be provided in response to a claim and that failure to issue the schedule within the stipulated timeframe will result in liability to pay the full amount claimed, or in loss of the entitlement to file a response if an adjudication is acommenced; and
  •   establishes an adjudication process that aligns more closely with the east coast model, including shorter timeframes for parties to provide notification of adjudication and responses as well as the option for a party to nominate an authorised authority to select an adjudicator.

The Bill will only apply to ‘construction contracts’, defined as contracts, agreements or other arrangements to carry out construction work, or to supply related goods and services. The Bill will not apply to:

  •   construction contracts for home building works with a value of less than $500,000; or
  •   mining, in that the Bill has a ‘mining exclusion’ providing that it does not apply to contracts for drilling or extracting particular resources as well as other mining related construction work.

A full version of the Bill can be found here.

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