Security of Payment Definitions WA

These definitions summarise and simplify what are often complex provisions under the Act. They are not necessarily exhaustive and should not be relied on in the event of a dispute. Detailed definitions are generally contained in section 3 of the Act although other definitions may be summarised from the body of the Act.

"Adjudication" also known as "Security of Payment" is a statutory dispute resolution process that has revolutionised the building and construction industry. The process is quick, informal and inexpensive. It is proving to be popular in its purpose of ensuring money flows quickly and fairly between industry parties.

"Adjudication Application" is an application made by an applicant to Adjudicate Today or other Prescribed Appointer for adjudication of a payment dispute under a construction contract.

Adjudicate Today staff will assist parties in complying with the procedures and time frames under the Act but, as they must be independent of the parties, cannot help develop submissions or give legal advice.

"Adjudicated Amount" is the amount of the progress payment that an adjudicator determines is to be paid by the respondent to the applicant.

"Adjudication Response" is the response of a respondent to the applicant's adjudication application.

"Applicant" is the person or organisation applying for adjudication of a payment dispute. Any party to a construction contract may apply for adjudication.

"Appointed Adjudicator" or "Adjudicator" is a qualified and experienced person registered by the Building Commissioner to conduct adjudications under the Act. The Adjudicator will be appointed by a Prescribed Appointor (such as Adjudicate Today) unless both the applicant and Respondent have already agreed on an adjudicator to conduct the adjudication. You can find a list of Adjudicate Today registered Adjudicators on our website.

"Building and Energy" or "Building Commission" is The Department of Mines, Industry Regulation and Safety – Building and Energy Division.

"Business Day" is any day other than a Saturday, Sunday or public holiday or a day in the period beginning on 25 December and ending 7 January.

“Construction Contract”. A complete definition can be found in the Act. In summary, a construction contract will include any contract for the carrying out of most activities relating to the construction of buildings and structures, as well as certain associated activities such as preparatory and completion works (such as earthmoving, landscaping and painting); the installation of fixtures and fittings and building systems (such as air conditioning and heating); supplying materials to site for use in construction; and professional services agreements, including design or quantity surveying services. If you are unsure whether your contract is a construction contract for the purposes of the Act, you may need to seek expert advice.

"Construction Work" is work defined in section 4 of the Act. It includes sites in WA both on land and off-shore and goods and services related to construction work (defined in section 5).

"Determination" is the adjudicator's decision on the merits of a payment dispute.

"Due Date for Payment" is the date on which a payment claim becomes due and payable in accordance with the terms of the contract. However the Act sets a maximum time period for the due date for payment of 42 days from the date of the payment claim which overrides any contractual provision which is longer.

"Payment Claim" is a claim made under a construction contract. by the contractor to the principal or by the principal to the contractor in relation to work or the non-performance of work. It may include matters covered by a previous payment claim.

"Payment Dispute". A complete definition can be found in the Act. In summary, a payment dispute will arise where: a payment claim is rejected, a payment claim is disputed, a payment comes due but is not paid, or retention or security is due to be returned but is not returned. The date on which the payment dispute crystallises is important; applications for adjudication must be made within 90 business days of that date.

"Prescribed Appointer" is an organisation that maintains a list of registered Adjudicators such as Adjudicate Today. Your selected Appointor will consider the details of the adjudication application and nominate an Adjudicator who has the skills and experience, and who is available to immediately conduct your adjudication. Unless both the Applicant and Respondent have agreed on a Prescribed Appointor, the Applicant is free to choose the Prescribed Appointor to serve the application on.

"Respondent" is a the person or organisation who is a party to the construction contract, but who has not applied for adjudication, and is the person or organisation against whom a payment dispute has arisen under the construction contract.

Click here to go to the flowchart