Security of Payment Definitions Tasmania

These definitions summarise and simplify what are often complex provisions under the Act.  The definitions are not necessarily exhaustive and should not be relied on in the event of a dispute.  Detailed definitions are contained in the Act. 

"Adjudication"also known as "Security of Payment" refers to compulsory rapid adjudication a new and unique form of statutory dispute resolution that has revolutionised the building and construction industry. The process is designed to be quick, informal and inexpensive. It is proving to be extraordinarily popular in ensuring money continues to flow in the industry quickly and fairly between parties.

"Adjudication Application" is an application made by a claimant to Adjudicate Today or other Nominating Authority for adjudication of a payment dispute under a construction contract.  In order to be valid strict timeframes must be followed [section 21].  The staff of Adjudicate Today will assist parties in complying with the procedures and timeframes of the Act but, as they must be independent of the parties, can't help develop submissions which address the merit issues of the payment dispute [section 17(1)].

"Adjudicated Amount" is the amount of the progress payment, if any, to be paid by the respondent to the claimant [section 25] .

"Adjudication Certificate" is a certificate provided by Adjudicate Today or other NA on application by a claimant when the respondent fails to pay the whole or any part of the adjudicated amount in a determination [section 26].

"Adjudication Response" is the response of a respondent to the claimant's adjudication application.  In order to be valid strict timeframes must be followed [section 23].

"Building" includes a proposed building or part of a building and a building that is able to berelocated;

"Building Code of Australia" means the code produced by the Australian Building Code Board relating to the design and construction of buildings.

"Building or construction contract" means a contract, or other arrangement, under which one party undertakes to carry out building work or construction work for, or to supply building or construction-related goods and services to, another party.

"Building or Construction Related Goods and Services" is work defined in section 6 of the Act , and in relation to construction work, includes materials, components, plant or material forming part of, or for use in connection with, the construction of any building, structure or work (including residential); and services including the provision of labour, professional services and related goods and services.

"Building Practitioner" means any of the following persons:

• a building practitioner, or an owner builder, within the meaning of the Building Act 2000;
• a person who holds a practitioner's licence, or a contractor's licence, under the Occupational Licensing Act 2005, authorising the person to perform electrical work within the meaning of Part 1 of Schedule 2 to that Act;
• a person who holds a subsisting certificate of registration under the Plumbers and Gas-fitters Registration Act 1951 to perform a class of plumbing work referred to in that Act;
• a person who holds a certificate of competency under the Workplace Health and Safety Regulations 1998;
• a person who holds a subsisting certificate of registration under the Plumbers and Gas-fitters Registration Act 1951 to perform a class of gas-fitting referred to in that Act;
• a person who is registered as an architect under the Architects Act 1929;
• a prescribed person.

"Building Work or Construction Work" is work defined in section 5 of the Act.  The construction work must be carried out in Tasmania after 17 December 2009 and includes domestic building work.

"Business Day" is any day other than a Saturday, Sunday, public holiday or the 27th, 28th, 29th, 30th or 31st of December.

"Claimant" is a person who has carried out construction work, or supplied related goods and services, and is or claims to be entitled to a progress claim under a construction contract [section 17].

"Claimed Amount" is the amount of the progress claim that the claimant claims is payable [section 17].

"Determination" is the adjudicator's determination [section 25].

"Due Date for Payment" is the date on which a payment claim becomes due and payable either by virtue of a valid contract provision or if there is no such valid provision, 10 business days after the payment claim is made or 20 business days if: (i) the claim relates to a residential structure to be built on land; and (ii) the respondent is the owner of the land; and (iii) the respondent is not a building practitioner. 

"Intention to Suspend Work" means the right of a claimant  to suspend construction work or the supply of related goods and services.   This right arises on the respondent's failure to provide a payment schedule and claimed amount by the due date; or provision of a payment schedule but failure to pay the scheduled amount by the due date; or failure to pay or provide security for an adjudicated amount.  The notification to suspend work will be in writing and provide 2 business days notice.

"owner", in relation to land, means any one or more of the following:

• the person in whom is vested a fee simple in the land;
• if the land is not registered under the Land Titles Act 1980 and is subject to a mortgage, the person for the time being holding the equity of redemption in that mortgage;
• if the land is held under a tenancy for life, the person who is the life tenant;
• if the land is held under a lease for a term of not less than 99 years or for a term of not less than another prescribed period, the person who is the lessee of the land;
• a person who has a prescribed interest in the land.

"Payment Claim" is a claim for a progress payment under a construction contract.  It must identify the construction work or related goods and services and the amount that the claimant claims to be payable.  In order to be a valid claim under the Act it must also state that "This is a payment claim made under the Building and Construction Industry Security of Payment Act 2009 (Tas)" or words to that effect.  [section 17].

"Payment Schedule" is the response served by a respondent to a payment claim.  It must identify the payment claim to which it relates and state the amount of the payment claim, if any, that the respondent proposes to make [section 18]. 

"Progress Payment" is a payment to which a person is entitled including a "milestone" payment, a single or one-off payment or the final payment for construction work or supplying related goods and services [section 12].

"Reference Date" is either the time for making progress claims as stated in the contract, or if the construction contract does not state the times, then it is the last day of each month of the calendar [section 4].

"Residential Payment Claim" means any claim, application or response under this Act which relates to a residential structure to be built on land and the respondent is the owner of the land and the respondent is not a building practitioner.

"Residential Structure" means a building or structure that is a class 1 or a class 10 building or structure within the meaning of the Building Code of Australia, as in force from time to time.

"Respondent" is a person who has received a valid payment claim and is liable, or may be liable, to make a payment under a construction contract [section 17] or for related goods or services.

"Scheduled Amount" is an amount of money that the respondent proposes to make in response to a payment claim.  If the scheduled amount is less than the claimed amount, the schedule must state why the scheduled amount is less and, if it is less, the respondent's reason for withholding payment.

"Section 21(4) Notice" (also known as "Optional Adjudication" or "the Second Notice") is a notification that the claimant has both not received the payment response within the time allowed by the Act nor the claimed amount and stating that the respondent has 5 business days in which to serve a payment schedule or pay the payment claim in full before the claimant applies for adjudication [section 21(4)].