Claimant: Common Pitfalls
Adjudicate Today has managed thousands of adjudication applications over the last 12 years (over 60% of all applications made nationally) and we have learnt many lessons. Parties have requested we list the most common mistakes we see in adjudication. Here is our list of issues that claimants must get right.
- From the date the payment claim is served on the respondent, the Act provides strict time frames for the service of payment schedules, section 18(2) notice for optional adjudication and adjudication applications. Neither Adjudicate Today nor the adjudicator can extend time frames and if any document is received/served just one or more business day outside the prescribed time, it may affect the validity of the adjudication application. The main hurdle is that the Act requires, unless the construction contract provides for a longer period, that the progress claim be made within 3 months after the construction work to which the claim relates was last carried out or the related goods and services were last supplied.
- In the adjudication application, provide evidence that the prescribed time frames have been complied with by including written confirmation of both the specific date and method by which the payment claim, payment schedule (if served) and section 18(2) notice (if required) were received/served (e.g. courier, facsimile, email etc.).
- Where items are sent by ordinary post, allow sufficient time for the item to be received. Items sent by ordinary post are deemed to be received on the second working day after posting (see Section 50(2)(a) of the Act). We recommend against post as many respondents have denied receipt. We recommend courier (signature required) or fax as the preferred form of service. When using fax, please 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.
- The due date for payment must by definition fall after the date of service of the Payment Claim. A valid section 18(2) notice must by definition be served after the due date for payment has passed.
- Calculate time frames carefully noting that the date of receipt of a particular document is counted as day 0 (weekends and public holidays are excluded).
Demonstrate an entitlement to the debt
- Include in the adjudication application a written submission and supporting documents which:
(i) demonstrate that a particular agreement was made (whether written or oral) between the claimant and respondent;
(ii) that the payment claim has been calculated in accordance with the contract; and
(iii) that the claimant has performed the work or provided the related goods and services as claimed.
- If no payment schedule is provided by the respondent, the adjudicator must still be satisfied that there was a contract under which work was performed to the claimed value. Therefore the written submission and supporting documents must still be provided.
- Too often claimants assume an adjudicator will seek additional submissions if the application does not substantially demonstrate an entitlement to the amount claimed or is unclear. Usually there is insufficient time for this and, in any case, it is not the adjudicator’s responsibility to assist the claimant by inviting further information to strengthen its case.
- Ensure the payment claim is addressed to the legal entity that the claimant had contracted with. For example, if the claimant contracted with Fred Smith t/as ABC Building but the payment claim was issued in the name of ABC Building Pty Ltd, the claimant may have trouble enforcing an adjudication determination.
Please return to "Claimant: Preparing the Payment Claim".