Security of payment and Adjudication

In the construction industry, payment delays or non-payment can severely disrupt cash flow and project timelines. To combat this issue, the Building and Construction Industry Security of Payment Act 1999 (NSW) (“SOPA”) was introduced, streamlining traditional debt recovery methods.

What is the Security of Payment Act?

SOPA ensures that builders, subcontractors and other professionals (such as architects) can promptly recover payment for work, goods or services. SOPA offers a solution to prevalent payment challenges experienced in the industry relating to payment withholding, shortfalls or non-payment.

SOPA entitles builders and contractors to make progress claims for payment throughout the project, not just on completion. This prevents a party from attempting to withhold payment simply because the work is incomplete.

Why SOPA is Essential

1. Applies to all construction contracts including both written and oral contracts. SOPA rights cannot be contracted out of.
2. Resolves payment disputes quickly rather than through expensive court proceedings.
3. Protects subcontractors and suppliers' rights ensuring timely payments to improve cash flow and prevent unjustified late payments and non-payments.
4. Imposes strict timeframes which must be adhered to in order to respond to claims.
5. Provides a contractor with an opportunity to respond to a claim for payment and provide reasons for nonpayment.
6. Protects homeowners by preventing excessive claims from contractors or builders, ensuring homeowners receive the quality of work that they have paid for.

How Can We Help?

Our team has extensive experience acting for both applicants and respondents in this area.

If you’re making a claim, we can assist by reviewing and preparing your progress payment claims, advising you on your rights and the strength of your claim, and managing the entire adjudication process including preparing the application, submissions and any further material requested by the adjudicator. We also assist with enforcing adjudication outcomes to ensure you receive payment promptly.

If you’re responding to a SOPA claim, we can help you prepare and review your payment schedule, advise on your legal obligations and draft a comprehensive adjudication response. If you achieve an unfair outcome, we can guide you through the process of disputing the decision and recovering any payments made, including pursuing a claim in court if necessary.

Let Us Get You a Good Outcome

Navigating the complexities of SOPA can be challenging. The process is highly technical and minor mistakes in form or timing can significantly affect the outcome of your claim. With the right legal guidance, recovering payment through SOPA can be a straightforward process. Let us take care of it for you.