Dealing with Payments Under the Building and Construction Industry Security of Payment Act 1999 (NSW) ("SOPA")

Key Features

SOPA sets out a statutory framework for:

  • Making a progress payment claim;
  • Responding to a progress payment claim;
  • Determining by adjudication the amount of a disputed progress payment; and
  • Payment of a determined progress claim amount.

Generally, in comparison to litigation in Court the SOPA process can be a quicker interim method to resolve progress payment disputes and obtain progress payments.

There are strict time limits that apply and construction industry participants should consider obtaining legal advice on the SOPA process to ensure they are not caught out by any non-compliance with the technicalities of the SOPA process – for general information see: SOPA workflow and SOPA flowchart.

Applicability

The SOPA regime has applicability for:

  • Principals – be they individuals, corporations, or owners corporations.
  • Contractors and Subcontractors carrying out construction work.
  • Contractors and Subcontractors carrying work related to construction work including – architectural, engineering, contract administration, and project management services.

Generally, the SOPA regime is applicable to a written or oral contract for:

  • Commercial construction work in NSW;
  • Construction work to common property in a strata scheme;
  • Residential construction work in NSW on premises where the Principal does not currently reside in, or does not propose to reside in, those premises.

Goods being:

  1. Materials and components that form part of any building, structure or work arising out of construction work of the type set out above; or
  2. Plant or materials for use in connection with the carrying out of construction work of the type set out above

Services being:

  1. Labour to carry out construction work of the type set out above; or
  2. Architectural, design surveying or quantity surveying services in relation to construction work of the type set out above; or
  3. Building, engineering, interior or exterior decoration or landscape advisory services in relation to construction work of the type set out above

Bannermans can provide the legal expertise you need to guide you through any part of the SOPA process. Contact us for help.

 

***The information contained in this article is general information only and not legal advice. The currency, accuracy and completeness of this article (and its contents) should be checked by obtaining independent legal advice before you take any action or otherwise rely upon its contents in any way.

 

Prepared by Bannermans Lawyers

27 July 2015

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For more information on this topic or any legal enquiries please contact your Construction Team.

 
 

 

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