NSW: Claimant NOT Paid, Prepares and Serves Adjudication Application
This section provides guidance for the claimant in completing an adjudication application where the respondent has failed to provide a payment schedule despite having been served with a section 17(2) second opportunity notice.
What happens now?
The adjudication application must be prepared and served by the claimant on Adjudicate Today and the respondent within 10 business days after the expiry of 5 business days from the respondent's receipt of the second opportunity [s17(2)] notice.
Due to a drafting "quirk" in the Act, a claimant who receives a payment schedule after serving a second opportunity s.17(2) notice must wait until the notice expires (5 business days after receipt) before the 10 business days for service of the adjudication application commences. Service of an adjudication application on Adjudicate Today before the 5 business days after receipt has elapsed may render the application invalid or, at the least, require that it be resubmitted.
An adjudication application must:
- Be in writing addressed to Adjudicate Today requesting the nomination of an adjudicator;
- Be lodged with Adjudicate Today within 10 business days after the expiry of 5 business days from the respondent's receipt of the second opportunity [s17(2)] notice;
- Be served upon the respondent. The copy must be identical to that provided to Adjudicate Today. Any delay in serving the respondent delays adjudication;
- Attach a copy of the payment claim and the second opportunity [s17(2)] notice;
- Contain a written submission evidencing that the claimed amount is due and unpaid and the value of the work, materials or services for which payment is claimed;
- Have attached to the written submission all the information (including certificates, test results, delivery dockets, invoices, photographs, statutory declarations, expert reports, written statements and arguments) which the claimant wants to put to the adjudicator in support of the written submission; and
- Include a copy of the contract or all relevant contract terms and conditions. This may be a formal written contract document, an exchange of letters, a quotation, an acceptance or a record of an oral agreement under which the payment claim is made.
In the absence of a payment schedule, there is no reason to speculate on possible reasons for non-payment of a claim. To do so places matters before the adjudicator which the Act prevents the respondent from raising.
The Act requires the payment of an ANA's prescribed application fee when the application is lodged. The prescribed application fee charged by Adjudicate Today is NIL ($0:00) dollars.
Download the Adjudication Application form *Note: This form is interactive. This means it can be EITHER filled out on screen and printed OR downloaded and printed for manual completion.
It is usually not sufficient for the claimant to merely refer to the payment claim and state that he/she is entitled to payment. The submission should:
- State that the work was in fact done and/or related goods and services were supplied as required by the provisions of the contract or agreement between the parties in accordance with the identified items and conditions of the contract (if possible, refer to the specific paragraph in the contract).
- Attach a copy of the contract. If the contract or agreement is wholly or partly oral, set out the precise terms of the oral agreement, when it was made and the named person who entered the contract on behalf of the respondent. Attach a copy of any emails, correspondence or paid invoices supporting the oral agreement.
- If the contract is not a formal contract but the result of letters or other correspondence, attach copies of the relevant letters and/or correspondence which constitute the contract or agreement.
- Show the nature and extent of the work done (including any rectification work of alleged defects) and/or related goods and services provided by the claimant under the contract and quantify their value.
- Clearly set out calculations showing how the amount claimed is made up by items/value with a total, including GST.
- If possible obtain witness statements or other technical reports, test results, photographs, invoices (from suppliers, quality assurance statements, statutory declarations of payment of workers subcontractor etc) or other documentation which supports the claim, attach these as numbered attachments. This is particularly important for larger claims. These attachments should show that the work was properly done and completed in line with the contract and/or that related goods and services were provided as per the progress claim. Statutory declarations are not necessary. Because an adjudicator cannot test the contents of a statutory declaration, they are given no greater weight than unsworn witness statements.
- Set out in separate numbered paragraphs the arguments with logical reasons as to why the claimant is entitled to receive the amount claimed as a progress claim. Refer back to any relevant material supporting each argument and quote the specific attachments (e.g. see Report dated... Attachment A etc.).
- Any legal advice and/or opinion which supports the claim may be attached as an annexure and should be referred to in the submission (a legal opinion is not necessary to make a claim).
- Ensure that submissions do not contain emotional words or language derogatory or defamatory of the respondent.
The overall submission should be concise, clearly written and set out the claimant's arguments and reasons. Remember the submission should always link back to any agreement/documentation, photographs, technical/legal reports which support the claimant's entitlement as set out in the payment claim.
How is an adjudication application served on Adjudicate Today?
Both Adjudicate Today and the respondent should be served with identical adjudication applications on the same day.
Service on Adjudicate Today will be effected by any of the following methods:
- Electronic File Delivery via Lockbox. You can send very large electronic files which have been zipped directly to Adjudicate Today. All files are encrypted and sent over a secure connection. They are held in your personal 'Lockbox'. Only you and Adjudicate Today authorised staff can access your Lockbox. We strongly recommend it over email as email may not be received. Once files complete uploading, they are acknowledged within minutes by an automated date and time stamped email. If the date and time stamped email is not received, there has been a problem uploading. Please phone our office: 1300 760 297 or email: email@example.com
Click here for details on establishing a free Lockbox account
- Electronic File Delivery via Email: firstname.lastname@example.org
- Electronic File Delivery via Fax: 1300 760 220. Adjudicate Today permits service of adjudication applications, notices and other documents by fax.
Following any form of electronic file delivery (Lockbox, email or fax), Adjudicate Today should receive an identical hard copy of all files within one business day of electronic delivery. Please read our disclaimer for details on rights and obligations for the delivery of electronic files.
- Physical Delivery. We accept delivery in any of our Australian offices (normal business hours). Our NSW address is Suite 2, Mona Vale Business, 90 Mona Vale Road, Mona Vale 2103.
A map to the office and addresses of other State offices are found on our Contact Us page.
How is an adjudication application served on the respondent?
Service should occur during normal business hours and at the respondent's ordinary place of business or as otherwise required by the contract. In the absence of a contrary contract provision, the safest way of ensuring service is to serve by courier with instruction to obtain a signed receipt. In our experience, below is the safest ranking to ensure service:
- Courier - signature required;
- Mail - Express Post: keep express post tracking number for delivery verification;
- Platinum Post - Signature required;
- Ordinary Post - Make a statement verifying the address, date of postage and other relevant details;
- Email (only to an email address which is specified by the person for the services of notices of that kind - generally the claimant). In email options, we advise tick both "request a delivery receipt" and "request a read receipt";
- In person - Ensure a receipt is obtained; or
- A different method only where such method is provided under the relevant construction contract. Please note that service by fax is only valid if provided by the contract. If service by fax is permitted, print and keep full page fax journal report as evidence of transmittal.
- Claimants are strongly advised to keep a record of the time, date and manner of service on the respondent. The time for the respondent to provide the payment schedule (response) runs from the date of receipt of the payment claim. A respondent may deny receipt of the payment claim in which case the claimant must be able to evidence the date of service.
- When items are sent by ordinary post, allow sufficient time for them to be received. Generally, items sent by ordinary post are deemed to be received on the fourth working day after posting. We recommend against post as respondents have denied receipt.
- Should fax be permitted by contract as a form of service, ensure you retain the full page fax receipt and refrain from sending colour photographs, and plans as they are generally rendered unreadable. Lengthy faxes have been known to lose pages in transmission.
It is most important that the claimant keeps a record of the time, date and manner of service on the respondent as time runs from the date of service.
Upon receipt of the application, Adjudicate Today nominates an appropriate adjudicator from our panel of registered adjudicators to determine the matter. Adjudicators cannot be pre-appointed under a construction contract and parties must not seek to influence an ANA in appointing any particular adjudicator. The Supreme Court may invalidate any adjudication determination where a party has influenced an adjudicator appointment. However if parties agree to the appointment of a particular adjudicator after the adjudication application is filed, Adjudicate Today will seek to accommodate the agreement.
Within 4 business days of receipt of an application, Adjudicate Today will provide a formal Notification of Acceptance of the adjudication application on behalf of the appointed adjudicator. If this does not occur the claimant can withdraw the application and has a further 5 business days to lodge an application with another ANA.
In addition, the Act allows subcontractors who make an adjudication application to freeze payments from the principal contractor to the respondent while adjudication proceeds.
Please move to the next step on the NSW flowchart being "Respondent has no right to serve an Adjudication Response as did not serve a Payment Schedule within 5 business days of receipt of Adjudication Notice [s.17(2) notice]".