Security of Payment Act
The ACT Building and Construction Industry (Security of Payment) Act 2009 establishes an adjudication process so that people who carry out construction work, or supply goods and services can receive timely payment.
Under this informal, inexpensive and quick process, an authorised nominating authority (ANA) appoints an adjudicator to hear disputes about account payments. In this way, parties can avoid court litigation.
The Act applies to construction contracts entered into from July 1, 2010.
Authorised nominating authorities
The following organisations have been authorised as nominating authorities:
The adjudication process
Under the Building and Construction Industry (Security of Payment) Act authorised nominating authorities can receive adjudication applications, nominate adjudicators and issue adjudication certificates.
Independent adjudicators with relevant expertise adjudicate in a tight timeframe. If the adjudicator’s decision is, in whole or part, in favour of the applicant, the respondent has to pay the applicant an amount determined by the adjudicator. These decisions are enforceable as a judgement debt through the courts.
The adjudication process does not extinguish a party’s ordinary contractual rights to seek a final resolution of a payment dispute by a court or tribunal.
The adjudication process does not apply to construction contracts that form part of a loan agreement or for residential building work if a resident owner is a party to the contract, except where the work is done under an owner-builder licence. ‘Pay when paid’ provisions in a contract have no effect and do not prevent a person’s rights under the Act to seek a payment.