The proposed brave new world becomes reality – what the passing of the Building Industry Fairness (Security of Payment) Act 2017 (Act) means for you
On 23 August 2017 we advised of the introduction of the Building Industry Fairness (Security of Payment) Bill 2017 (Bill) into parliament and provided a detailed summary of the significant amendments proposed to three key pieces of legislation relevant to the Queensland construction and infrastructure sector, being the:
We can today confirm that the Act was passed late yesterday afternoon by state parliament.
Despite the fact that a number of amendments were made to the Bill which was placed before parliament on 22 August 2017, from a practical perspective the steps necessary from members of the sector to respond to the new Act are generally consistent with those necessary to respond to the Bill. In this update we will focus solely on the differences between the Bill and the Act which have day to day practical ramifications for those in the industry. For a more detailed summary of all of the changes being made by the Act, please click here to read our update from 23 August 2017 which set out in greater detail the amendments proposed by the Bill (now the Act).
Practically speaking the major changes in the Act from the Bill involve the security of payment legislation and, in particular the timing of payment schedules. In a significant change from the regime under the Building and Construction Industry Payments Act (Previous Act) and that proposed under the Bill, a party will now be required to serve a payment schedule within the shorter of:
The above timeframes will apply irrespective of whether the payment claim is a complex or standard claim.
Additionally, in a response to the outcry from industry regarding the requirement to serve a payment schedule in response to every payment claim (even if the amount of the payment claim was to be paid in full) the Act contains a provision making clear that a payment schedule is not required if the full amount of the payment claim is to be paid in full and is paid in full within the shorter of the three timeframes noted above.
Further, and again, in response to industry feedback and concern regarding the increasing of the relevant time period for excluded individuals and excluded companies from one year to two years the Act now contains an exception if the individual can satisfy the commissioner that at the time he/she ceased to be a director, secretary or influential person, the company was solvent.
Whilst it has not changed from the Bill, it is also imperative to note the following three important practical changes from the Previous Act:
The exact date of commencement is currently unknown, however speculation to date has generally suggested a commencement date of early to mid January.
If you would like any further information in relation to the new Act and how it may impact your business please do not hesitate to contact us.
Troy Lewis, Partner & National Head of Construction and Infrastructure
T: +61 7 3135 0614
Stephen Burton, Partner
T: +61 7 3135 0604
Suzy Cairney, Partner
T: +61 7 3135 0684
Scott Alden, Partner
T: +61 2 8083 0419
Christine Jones, Partner
T: +61 2 8083 0477
Helena Golovanoff, Partner
T: +61 2 8083 0443
Stephen Natoli, Partner
T: +61 3 9321 9796
Kyle Siebel, Partner
T: +61 3 9321 9877
The information in this publication is of a general nature and is not intended to address the circumstances of any particular individual or entity. Although we endeavour to provide accurate and timely information, we do not guarantee that the information in this publication is accurate at the date it is received or that it will continue to be accurate in the future. We are not responsible for the information of any source to which a link is provided or reference is made and exclude all liability in connection with use of these sources.