Payment claims on Australian projects may trigger statutory response requirements that differ by jurisdiction. The team needs a reliable route from receipt to assessment and service.
Set up the payment process before the first claim
A subcontractor sends its monthly claim to the site team. The quantity surveyor queries two variations, accounts waits for a purchase order and the project manager assumes the matter is being dealt with. Several people are involved, but no one has taken responsibility for the formal response.
This article concerns setting up a reliable payment workflow for an Australian project, using the requirements of its jurisdiction. It is not a detailed guide to every state and territory regime. New Zealand’s claim and schedule requirements are covered separately.
Identify the applicable payment regime
Australia does not have a single national security-of-payment procedure. State and territory requirements differ, including coverage, claim requirements, response periods and adjudication procedures. The location of the work, the contract and any relevant transitional provisions need checking before the team adopts a procedure.
Do not transfer a template from another state without reviewing it. Queensland and New South Wales, for example, have different requirements for the content of a payment claim. A national business should maintain a project-specific payment checklist, with a named person responsible for keeping it current.
Make the amount traceable
Show how the current claim has been calculated. Distinguish the value of work, variations, adjustments, retention and amounts previously paid. If the assessment is cumulative, make that clear so that the recipient can reconcile this month’s amount with last month’s position.
A line stating “additional works” may conceal several unrelated changes. Give each item a reference and connect it to the instruction, measurement or other basis of entitlement. Where a rate or quantity is disputed, show the calculation rather than simply carrying forward an unexplained balance.
The valuation needs to be supportable, but supporting detail does not replace the formal requirements for a valid claim. Check the required wording, any accompanying statements, the permitted timing and the method of service separately.
Make receipt trigger an assessment
Record when and how the claim was received. Calculate the response and payment deadlines using the applicable contract and legislation; they may be different dates. Do not assume that a familiar invoice format means statutory payment requirements can be ignored.
Route the claim to the person authorised to respond, with sufficient time for technical and commercial input. If the proposed payment is less than the amount claimed, identify the disputed items and the reasons. A note that a variation is “not approved” may fail to explain whether the objection concerns authority, scope, quantity or price.
Keep discussions and formal responses separate
Continue discussing the valuation, but do not assume those discussions extend a statutory deadline. An internal assessment, a draft certificate and an issued payment schedule are different things. Confirm which document is required, who must receive it and how it is to be served.
Retain the issued document and evidence of service. Before the deadline, the responsible person should be able to confirm that the response has gone, rather than that someone has approved it for issue. Accounts should also know the amount and date of the payment to be made.
Deal promptly with a missed step
If a response or payment is late, establish the position immediately. The available remedies, further notices and time limits depend on the jurisdiction and circumstances. Obtain advice on those steps before sending a further claim, commencing adjudication or considering suspension.
After dealing with the immediate issue, correct the process that allowed it to happen. The useful questions are practical: which inbox received the claim, who owned the deadline, who could authorise the response and what happened when that person was unavailable?
