Section 42(4) of the Queensland Building Services Authority Act (QBSA Act) provides that if you carry out “building work” without the appropriate licence (QBSA licence) then you are “not entitled to any monetary or other consideration” for carrying out that work.
In Ooralea Developments Pty Ltd v Civil Contractors (Aust) Pty Ltd & Anor, a civil contractor recently found that its security for payment claim was void because it did not have the appropriate QBSA licence under the QBSA Act for the construction and installation of roads and pipes for a new estate.
The contract was for the construction of earthworks, roadworks, stormwater drainage, sewer and water reticulation in a new estate development. The Contractor did not have any QBSA licences. The Contractor served the Respondent with a payment claim pursuant toBuilding and Construction Industry Payments Act 2004 (BCIPA) and the Respondent refused to pay.
The critical issue was whether roadworks and pipeworks were building work under the QBSA Act. The Contractor argued that the QBSA Act regulations expressly excluded the construction of a ‘water reticulation system, sewerage system or stormwater drain, outside the boundaries of private property’ and the construction of a ‘road’ from being building work and, as a result no licence was needed.
The Court held that building work had a very wide definition under the QBSA Act as it includes ‘any fixed structure’, which includes structures which are not buildings. Both the pipeworks and roads were clearly structures built on land.
In relation to roads, even though the property on which the road was built had been subject to development approval by the local authority, the road had been notified as being for public use. As the road had not been declared, it was not a road to which the exclusion applied. Therefore, the Contractor had no right to make a payment claim for the roadworks under the QBSA Act or BCIPA as it did not have a licence.
Civil contractors must always ensure that they hold the appropriate QBSA licence, or they may not have an entitlement to be paid under BCIPA, have difficulty recovering any payments under the contract, and may also be prosecuted for breach of the QBSA Act. This will apply even where a licence is held but the scope of work for the licence does not cover the work being carried out.
While this is not a new change to the QBSA Act, it is now very clear that civil contractors must closely look at the work to be carried out and ensure they have the appropriate QBSA licence to do that work.
Troy Lewis, Partner
T: +61 7 3135 0614
Stephen Burton, Partner
T: +61 7 3135 0604
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.