NSW: Payment Schedule Served - Claimant Suspends Work

There are 3 circumstances in which a claimant may exercise an entitlement to suspend work:

1. The claimant has received a valid payment schedule but the respondent fails to pay the scheduled amount by the due date for payment ; or
   
   
2. The respondent fails to serve a payment schedule within time and does not pay the whole claimed amount by the due date for payment; or
   
   
3. The adjudicated amount is not paid within 5 business days after an adjudication determination is received by the respondent, or later date if determined by the adjudicator.

Regardless of anything in the contract, the claimant is not liable for any loss or expense suffered by the respondent as a consequence of a suspension of work under the Act. If in response to a suspension the respondent removes any work from the claimant's contract, the respondent is liable for any loss and expense suffered by the claimant as a result of the respondent's action.

The respondent must be provided with 2 business days' written notice of the claimant's intention to suspend work. For example, if the due date for payment is Monday and the written notice is provided on Tuesday, work may be suspended from Friday of the same week.

The notice may take the form:

"You have failed to pay the amount due under the Building and Construction Industry Security of Payment Act 1999 NSW in respect of my payment claim served on you on [date]......... Take notice that pursuant to my right under section 27 of the Act, I will suspend work at the expiration of two business days unless, in the meantime, the amount due is paid in full ". Once the claimant has been paid the amount due, work must resume within 3 business days.

Payment for any loss and expense can be pursued through adjudication like any other due payments.

Please move to the next step on the NSW flowchart being"Claimant has 10 business days to prepare and serve Adjudication Application on Adjudicate Today from date of receipt of the Payment Schedule. Must also serve Respondent. However if the Adjudication Notice [ s.17(2)] was served, the time is 10 business days after expiry of the 5 business days given by that notice".