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This is a Bill, not an Act. For current law, see the Acts databases.


CONSTRUCTION CONTRACTS BILL 2004

                       Western Australia


      Construction Contracts Bill 2004

                          CONTENTS


      Part 1 -- Preliminary
1.    Short title                                            2
2.    Commencement                                           2
3.    Interpretation                                         2
4.    Construction work                                      4
5.    Goods and services related to construction work        6
6.    Payment dispute                                        8
7.    Construction contracts to which this Act applies       8
8.    Application to Crown                                   9
      Part 2 -- Content of construction
           contracts
      Division 1 -- Prohibited provisions
9.    Prohibited: pay if paid/when paid provisions          10
10.   Prohibited: provisions requiring payment to be made
      after 50 days                                         10
11.   Prohibited: prescribed provisions                     10
12.   Other provisions of contract not affected             10
      Division 2 -- Implied provisions
13.   Variations of contractual obligations                 10
14.   Contractor's entitlement to be paid                   11
15.   Contractor's entitlement to claim progress payments   11
16.   Making claims for payment                             11
17.   Responding to claims for payment                      11
18.   Time for payment                                      11
19.   Interest on overdue payments                          12
20.   Ownership of goods                                    12
21.   Duties as to unfixed goods on insolvency              12
22.   Retention money                                       12
23.   Implied provisions: interpretation etc.               13

                                                            page i
                            271--2
Construction Contracts Bill 2004



Contents



           Part 3 -- Adjudication of disputes
           Division 1 -- Preliminary
   24.     Interpretation of "construction contract"              14
           Division 2 -- Commencing adjudication
   25.     Who can apply for adjudication                         14
   26.     Applying for adjudication                              14
   27.     Responding to an application for adjudication          15
   28.     Appointment of adjudicator in absence of agreed
           appointment                                            16
   29.     Adjudicators: conflicts of interest                    17
           Division 3 -- The adjudication process
   30.     Object of the adjudication process                     17
   31.     Adjudicator's functions                                18
   32.     Adjudication procedure                                 19
   33.     Interest up to determination                           20
   34.     Costs of parties to payment disputes                   21
   35.     Certificates of completion etc., effect of             21
   36.     Determination, content of                              22
   37.     Dismissed applications                                 23
           Division 4 -- Effect of determinations
   38.     Determinations have effect despite other proceedings   23
   39.     Payment of amount determined and interest              23
   40.     Progress payments under determinations to be on
           account                                                24
   41.     Determinations are final                               24
           Division 5 -- Enforcing determinations
   42.     Non-compliance by principal, contractor may suspend
           its obligations                                        25
   43.     Determinations may be enforced as judgments            26
           Division 6 -- General
   44.     Costs of adjudications                                 26
   45.     Effect of this Part on civil proceedings               28
   46.     Review, limited right of                               29
           Part 4 -- Administration
   47.     Registrar, appointment and functions                   30
   48.     Registering adjudicators                               30
   49.     Review of registration decisions                       31


page ii
                                         Construction Contracts Bill 2004



                                                                Contents



50.   Publication of adjudicators' decisions                       31
51.   Appointors' and adjudicators' rates to be published          32
52.   Annual report                                                32
      Part 5 -- Miscellaneous
53.   No contracting out                                           33
54.   Immunity from tortious liability                             33
55.   Regulations                                                  34
56.   Review of Act                                                34
      Schedule 1 -- Implied provisions                              35
      Division 1 -- Variations                                      35
1.    Variations must be agreed                                    35
      Division 2 -- Contractor's entitlement to be paid             35
2.    Contractor entitled to be paid                               35
      Division 3 -- Claims for progress payments                    35
3.    Entitlement to claim progress payments                       35
4.    When claims for progress payments can be made                35
      Division 4 -- Making claims for payment                       36
5.    Claim for payment, content                                   36
      Division 5 -- Responding to claims for payment                37
6.    Interpretation in Division 5                                 37
7.    Responding to a payment claim                                37
      Division 6 -- Interest on overdue payments                    38
8.    Interest payable on overdue payments                         38
      Division 7 -- Ownership of goods                              39
9.    When ownership of goods supplied by contractor
      passes                                                       39
      Division 8 -- Duties as to unfixed goods on
             insolvency                                            39
10.   Duties of principal or landowner etc. as to unfixed
      goods on insolvency                                          39
      Division 9 -- Retention money                                 40
11.   Retention money to be held on trust                          40
      Defined Terms



                                                                  page iii
                           Western Australia


                     LEGISLATIVE ASSEMBLY

                      (As amended in Committee)



           Construction Contracts Bill 2004


                               A Bill for


An Act --
•  to prohibit or modify certain provisions in construction
   contracts;
•  to imply provisions in construction contracts about certain
   matters if there are no written provisions about the matters in the
   contracts;
•  to provide a means for adjudicating payment disputes arising
   under construction contracts,
and for related purposes.



The Parliament of Western Australia enacts as follows:




                                                               page 1
     Construction Contracts Bill 2004
     Part 1         Preliminary

     s. 1



                              Part 1 -- Preliminary
     1.         Short title
                This Act may be cited as the Construction Contracts Act 2004.

     2.         Commencement
 5        (1)   This Act comes into operation on a day fixed by proclamation.
          (2)   Different days may be fixed under subsection (1) for different
                provisions.

     3.         Interpretation
                In this Act, unless the contrary intention appears --
10              "adjudication" means the adjudication of a payment dispute in
                     accordance with Part 3;
                "applicant", in relation to an adjudication, means the person
                     who, under section 26, makes the application for the
                     adjudication;
15              "appointed adjudicator", in relation to a payment dispute,
                     means the registered adjudicator who, having been
                     appointed under Part 3 to adjudicate the dispute, has been
                     served with the application for adjudication;
                "construction contract" means a contract or other agreement,
20                   whether in writing or not, under which a person (the
                     "contractor") has one or more of these obligations --
                     (a) to carry out construction work;
                     (b) to supply to the site where construction work is being
                           carried out any goods that are related to construction
25                         work by virtue of section 5(1);
                     (c) to provide, on or off the site where construction work
                           is being carried out, professional services that are
                           related to the construction work by virtue of
                           section 5(2);



     page 2
                                      Construction Contracts Bill 2004
                                           Preliminary          Part 1

                                                                    s. 3



         (d)    to provide, on the site where construction work is
                being carried out, on-site services that are related to
                the construction work by virtue of section 5(3)(b);
     "construction work" has the meaning given to that term in
 5       section 4;
     "contractor" has the meaning given by the definition of
         "construction contract";
     "costs of an adjudication" has the meaning given to that term
         in section 44;
10   "determination" means a determination, made on an
         adjudication under Part 3, of the merits of a payment
         dispute;
     "obligations", in relation to a contractor, means those of the
         obligations described in the definition of "construction
15       contract" that the contractor has under the construction
         contract;
     "party", in relation to an adjudication, means the applicant and
         any person on whom an application for the adjudication is
         served;
20   "party", in relation to a construction contract, means a party to
         the contract;
     "payment claim" means a claim made under a construction
         contract --
         (a) by the contractor to the principal for payment of an
25              amount in relation to the performance by the
                contractor of its obligations under the contract; or
         (b) by the principal to the contractor for payment of an
                amount in relation to the performance or
                non-performance by the contractor of its obligations
30              under the contract;
     "payment dispute" has the meaning given to that term in
         section 6;
     "prescribed appointor" means a person prescribed as such by
         the regulations;

                                                                 page 3
     Construction Contracts Bill 2004
     Part 1         Preliminary

     s. 4



                "principal", in relation to a construction contract, means the
                    party to whom the contractor is bound under the contract;
                "registered adjudicator" means an individual registered as
                    such under section 48;
 5              "Registrar" means the Construction Contracts Registrar
                    designated under section 47.

     4.         Construction work
          (1)   In this section --
                "civil works" includes --
10                   (a) a road, railway, tramway, aircraft runway, canal,
                            waterway, harbour, port or marina;
                     (b) a line or cable for electricity or telecommunications;
                     (c) a pipeline for water, gas, oil, sewage or other
                            material;
15                   (d) a path, pavement, ramp, tunnel, slipway, dam, well,
                            aqueduct, drain, levee, seawall or retaining wall; and
                     (e) any works, apparatus, fittings, machinery or plant
                            associated with any works referred to in
                            paragraph (a), (b), (c) or (d);
20              "site in WA" means a site in Western Australia, whether on
                     land or off-shore.
          (2)   In this Act --
                "construction work" means any of the following work on a
                     site in WA --
25                   (a) reclaiming, draining, or preventing the subsidence,
                            movement or erosion of, land;
                     (b) installing, altering, repairing, restoring, maintaining,
                            extending, dismantling, demolishing, or removing,
                            any works, apparatus, fittings, machinery, or plant,
30                          associated with any work referred to in paragraph (a);



     page 4
                                   Construction Contracts Bill 2004
                                        Preliminary          Part 1

                                                                  s. 4



     (c)   constructing the whole or a part of any civil works, or
           a building or structure, that forms or will form,
           whether permanently or not and whether in WA or
           not, part of land or the sea bed whether above or
 5         below it;
     (d)   fixing or installing on or in any thing referred to in
           paragraph (c) any fittings forming, or to form,
           whether permanently or not, part of the thing,
           including --
10            (i) fittings for electricity, gas, water, fuel oil, air,
                   sanitation, irrigation, telecommunications,
                   air-conditioning, heating, ventilation, fire
                   protection, cleaning, the security of the thing,
                   and the safety of people; and
15           (ii) lifts, escalators, insulation, furniture and
                   furnishings;
     (e)   altering, repairing, restoring, maintaining, extending,
           dismantling, demolishing or removing any thing
           referred to in paragraph (c) or any fittings described
20         in paragraph (d) that form part of that thing;
     (f)   any work that is preparatory to, necessary for, an
           integral part of, or for the completion of, any work
           referred to in paragraph (a), (b), (c), (d) or (e),
           including --
25            (i) site or earth works, excavating, earthmoving,
                   tunnelling or boring;
             (ii) laying foundations;
            (iii) erecting, maintaining or dismantling
                   temporary works, a temporary building, or a
30                 temporary structure including a crane or other
                   lifting equipment, and scaffolding;
            (iv) cleaning, painting, decorating or treating any
                   surface; and
             (v) site restoration and landscaping;


                                                               page 5
     Construction Contracts Bill 2004
     Part 1         Preliminary

     s. 5



                     (g)   any work that is prescribed by regulations to be
                           construction work for the purposes of this Act.
          (3)   Despite subsection (2) construction work does not include any
                of the following work on a site in WA --
 5                (a) drilling for the purposes of discovering or extracting oil
                        or natural gas, whether on land or not;
                  (b) constructing a shaft, pit or quarry, or drilling, for the
                        purposes of discovering or extracting any mineral
                        bearing or other substance;
10                (c) constructing any plant for the purposes of extracting or
                        processing oil, natural gas or any derivative of natural
                        gas, or any mineral bearing or other substance;
                  (d) constructing, installing, altering, repairing, restoring,
                        maintaining, extending, dismantling, demolishing, or
15                      removing, wholly artistic works, including sculptures,
                        installations and murals;
                  (e) work prescribed by the regulations not to be
                        construction work for the purposes of this Act.
          (4)   In this Act --
20              "construction work" does not include constructing the whole
                     or part of any watercraft.

     5.         Goods and services related to construction work
          (1)   For the purposes of this Act, goods are related to construction
                work if they are --
25               (a) materials or components (whether pre-fabricated or not)
                        that will form part of any thing referred to in
                        section 4(2)(b) or 4(2)(c) or of any fittings referred to in
                        section 4(2)(d);
                 (b) any fittings referred to in section 4(2)(d) (whether
30                      pre-fabricated or not);
                 (c) plant or materials (whether supplied by sale, hire or
                        otherwise) for use in connection with the carrying out of

     page 6
                                            Construction Contracts Bill 2004
                                                 Preliminary          Part 1

                                                                           s. 5



                   the construction work at the site of the construction
                   work; or
            (d)    goods prescribed by the regulations to be related to
                   construction work for the purposes of this Act.
 5   (2)   For the purposes of this Act, professional services are related to
           construction work if they are --
             (a) services that are provided by a profession and that relate
                   directly to construction work or to assessing its
                   feasibility (whether or not it proceeds) --
10                   (i) including surveying, planning, costing, testing,
                           architectural, design, plan drafting, engineering,
                           quantity surveying, and project management,
                           services; but
                    (ii) not including accounting, financial, or legal,
15                         services;
                   or
             (b) services that are provided by a profession that are
                   prescribed by the regulations to be professional services
                   related to construction work for the purposes of this Act.
20   (3)   For the purposes of this Act, on-site services --
            (a) are services other than professional services referred to
                   in subsection (2); and
            (b) are related to construction work if they are --
                      (i) services that relate directly to construction work,
25                        including the provision of labour to carry out
                          construction work; or
                     (ii) services prescribed by the regulations to be
                          on-site services related to construction work for
                          the purposes of this Act.
30   (4)   The regulations may prescribe goods, professional services or
           on-site services that are not related to construction work for the
           purposes of this Act.


                                                                       page 7
     Construction Contracts Bill 2004
     Part 1         Preliminary

     s. 6



     6.         Payment dispute
                For the purposes of this Act, a payment dispute arises if --
                  (a)   by the time when the amount claimed in a payment
                        claim is due to be paid under the contract, the amount
 5                      has not been paid in full, or the claim has been rejected
                        or wholly or partly disputed;
                 (b)    by the time when any money retained by a party under
                        the contract is due to be paid under the contract, the
                        money has not been paid; or
10                (c)   by the time when any security held by a party under the
                        contract is due to be returned under the contract, the
                        security has not been returned.

     7.         Construction contracts to which this Act applies
          (1)   This Act applies to a construction contract entered into after this
15              Act comes into operation.
          (2)   This Act applies to a construction contract --
                  (a)   irrespective of whether it is written or oral or partly
                        written and partly oral;
                 (b)    irrespective of where it is entered into; and
20                (c)   irrespective of whether it is expressed to be governed by
                        the law of a place other than Western Australia.
          (3)   This Act does not apply to a construction contract to the extent
                to which it contains provisions under which a party is bound to
                carry out construction work, or to supply goods or services that
25              are related to construction work, as an employee (as defined in
                the Industrial Relations Act 1979 section 7) of the party for
                whom the work is to be carried out or to whom the goods or
                services are to be supplied.
          (4)   This Act, or a provision of this Act, does not apply to a
30              construction contract, or a class of construction contracts,


     page 8
                                      Construction Contracts Bill 2004
                                           Preliminary          Part 1

                                                                    s. 8



     prescribed by the regulations as a contract or class of contracts
     to which this Act, or that provision, does not apply.

8.   Application to Crown
     This Act binds the Crown.




                                                                 page 9
     Construction Contracts Bill 2004
     Part 2         Content of construction contracts
     Division 1     Prohibited provisions
     s. 9



               Part 2 -- Content of construction contracts
                      Division 1 -- Prohibited provisions
     9.        Prohibited: pay if paid/when paid provisions
               A provision in a construction contract has no effect if it purports
 5             to make the liability of a party ("A") to pay money under the
               contract to another party contingent, whether directly or
               indirectly, on A being paid money by another person (whether
               or not a party).

     10.       Prohibited: provisions requiring payment to be made after
10             50 days
               A provision in a construction contract that purports to require a
               payment to be made more than 50 days after the payment is
               claimed is to be read as being amended to require the payment
               to be made within 50 days after it is claimed.

15   11.       Prohibited: prescribed provisions
               A provision in a construction contract has no effect if it is a
               provision that is prescribed by the regulations to be a prohibited
               provision.

     12.       Other provisions of contract not affected
20             A provision in a construction contract that has no effect because
               of section 9 or 11 or that is modified under section 10 does not
               prejudice or affect the operation of other provisions of the
               contract.

                        Division 2 -- Implied provisions
25   13.       Variations of contractual obligations
               The provisions in Schedule 1 Division 1 are implied in a
               construction contract that does not have a written provision



     page 10
                                            Construction Contracts Bill 2004
                             Content of construction contracts        Part 2
                                           Implied provisions    Division 2
                                                                        s. 14



           about variations of the contractor's obligations under the
           contract.

     14.   Contractor's entitlement to be paid
           The provisions in Schedule 1 Division 2 are implied in a
 5         construction contract that does not have a written provision
           about the amount, or a means of determining the amount, that
           the contractor is entitled to be paid for the obligations the
           contractor performs.

     15.   Contractor's entitlement to claim progress payments
10         The provisions in Schedule 1 Division 3 are implied in a
           construction contract that does not have a written provision
           about whether or not the contractor is able to make a claim to
           the principal for a progress payment for the obligations the
           contractor has performed.

15   16.   Making claims for payment
           The provisions in Schedule 1 Division 4 are implied in a
           construction contract that does not have a written provision
           about how a party is to make a claim to another party for
           payment.

20   17.   Responding to claims for payment
           The provisions in Schedule 1 Division 5 about when and how a
           party is to respond to a claim for payment made by another
           party are implied in a construction contract that does not have a
           written provision about that matter.

25   18.   Time for payment
           The provisions in Schedule 1 Division 5 about the time by when
           a payment must be made are implied in a construction contract
           that does not have a written provision about that matter.




                                                                        page 11
     Construction Contracts Bill 2004
     Part 2         Content of construction contracts
     Division 2     Implied provisions
     s. 19



     19.       Interest on overdue payments
               The provisions in Schedule 1 Division 6 are implied in a
               construction contract that does not have a written provision
               about interest to be paid on any payment that is not made at the
 5             time required by the contract.

     20.       Ownership of goods
               The provisions in Schedule 1 Division 7 are implied in a
               construction contract that does not have a written provision
               about when the ownership of goods that are --
10               (a) related to construction work; and
                 (b) supplied to the site of the construction work by the
                      contractor under its obligations,
               passes from the contractor.

     21.       Duties as to unfixed goods on insolvency
15             The provisions in Schedule 1 Division 8 are implied in a
               construction contract that does not have a written provision
               about what is to happen to unfixed goods of a kind referred to in
               section 20 if either of the following persons becomes
               insolvent --
20               (a) the principal; or
                 (b) a person for whom, directly or indirectly, the principal is
                       performing construction work or to whom, directly or
                       indirectly, the principal is supplying goods and services
                       that are related to construction work.

25   22.       Retention money
               The provisions in Schedule 1 Division 9 are implied in a
               construction contract that does not have a written provision
               about the status of money retained by the principal for the
               performance by the contractor of its obligations.



     page 12
                                            Construction Contracts Bill 2004
                             Content of construction contracts        Part 2
                                           Implied provisions    Division 2
                                                                        s. 23



    23.   Implied provisions: interpretation etc.
          The Interpretation Act 1984 and sections 3 to 6 of this Act
          apply to the interpretation and construction of a provision that is
          implied in a construction contract under this Part despite any
5         provision in a construction contract to the contrary.




                                                                     page 13
     Construction Contracts Bill 2004
     Part 3         Adjudication of disputes
     Division 1     Preliminary
     s. 24



                      Part 3 -- Adjudication of disputes
                              Division 1 -- Preliminary
     24.         Interpretation of "construction contract"
                 Without affecting the operation of section 9, 11 or 53, a
 5               reference in this Part to a construction contract is a reference to
                 the contract including any provision that is modified under
                 section 10 or implied in the contract under Part 2 Division 2.

                     Division 2 -- Commencing adjudication
     25.         Who can apply for adjudication
10               If a payment dispute arises under a construction contract, any
                 party to the contract may apply to have the dispute adjudicated
                 under this Part unless --
                    (a) an application for adjudication has already been made
                         by a party, whether or not a determination has been
15                       made, but subject to section 37(2); or
                   (b) the dispute is the subject of an order, judgment or other
                         finding by an arbitrator or other person or a court or
                         other body dealing with a matter arising under a
                         construction contract.

20   26.         Applying for adjudication
           (1)   To apply to have a payment dispute adjudicated, a party to the
                 contract, within 28 days after the dispute arises or, if applicable,
                 within the period provided for by section 37(2)(b), must --
                   (a) prepare a written application for adjudication;
25                 (b) serve it on each other party to the contract;
                   (c) serve it --
                           (i) if the parties to the contract have appointed a
                                 registered adjudicator and that adjudicator
                                 consents, on the adjudicator;

     page 14
                                                 Construction Contracts Bill 2004
                                           Adjudication of disputes        Part 3
                                          Commencing adjudication     Division 2
                                                                             s. 27



                          (ii)   if the parties to the contract have appointed a
                                 prescribed appointor, on that appointor;
                         (iii)   otherwise, on a prescribed appointor chosen by
                                 the party;
 5                      and
                  (d)   provide any deposit or security for the costs of the
                        adjudication that the adjudicator or the prescribed
                        appointor requires under section 44(8) or (9).
           (2)   The application --
10                (a) must be prepared in accordance with, and contain the
                        information prescribed by, the regulations;
                  (b) must set out the details of, or have attached to it --
                           (i) the construction contract involved or relevant
                                extracts of it; and
15                        (ii) any payment claim that has given rise to the
                                payment dispute;
                        and
                  (c) must set out or have attached to it all the information,
                        documentation and submissions on which the party
20                      making it relies in the adjudication.
           (3)   A prescribed appointor that is served with an application for
                 adjudication made under subsection (1) must comply with
                 section 28.

     27.         Responding to an application for adjudication
25         (1)   Within 14 days after the date on which a party to a construction
                 contract is served with an application for adjudication, the party
                 must prepare a written response to the application and serve it
                 on --
                   (a) the applicant and on any other party that has been served
30                      with the application; and



                                                                           page 15
     Construction Contracts Bill 2004
     Part 3         Adjudication of disputes
     Division 2     Commencing adjudication
     s. 28



                  (b)   the appointed adjudicator or, if there is no appointed
                        adjudicator, on the prescribed appointor on which the
                        application was served under section 26(1)(c).
           (2)   The response --
 5                (a) must be prepared in accordance with, and contain the
                        information prescribed by, the regulations;
                  (b) must set out the details of, or have attached to it, any
                        rejection or dispute of the payment claim that has given
                        rise to the dispute; and
10                (c) must set out or have attached to it all the information,
                        documentation and submissions on which the party
                        making it relies in the adjudication.

     28.         Appointment of adjudicator in absence of agreed
                 appointment
15         (1)   If an application for adjudication is served on a prescribed
                 appointor the appointor, within 5 days after being served,
                 must --
                    (a) appoint a registered adjudicator to adjudicate the
                         payment dispute concerned;
20                 (b) send the application and any response received by it to
                         the adjudicator;
                    (c) notify the parties in writing accordingly; and
                   (d) notify the Registrar in writing accordingly.
           (2)   If a prescribed appointor does not make an appointment under
25               subsection (1) the Registrar may appoint a registered
                 adjudicator to adjudicate the payment dispute concerned.
           (3)   If the Registrar makes an appointment under subsection (2), the
                 Registrar must --
                    (a) notify the prescribed appointor in writing accordingly
30                       and require the appointor to serve the application and
                         any response received by it on the adjudicator appointed
                         by the Registrar; and

     page 16
                                                  Construction Contracts Bill 2004
                                            Adjudication of disputes        Part 3
                                           The adjudication process    Division 3
                                                                              s. 29



                  (b)    notify the parties in writing accordingly.

     29.         Adjudicators: conflicts of interest
           (1)   An appointed adjudicator who has a material personal interest in
                 the payment dispute concerned or in the construction contract
 5               under which the dispute has arisen or in any party to the
                 contract is disqualified from adjudicating the dispute.
           (2)   If an appointed adjudicator is disqualified --
                    (a) the adjudicator must notify the parties in writing of the
                         disqualification and the reasons for it;
10                 (b) unless, within 5 days after the date of the adjudicator's
                         notice, all of the parties in writing authorise the
                         adjudicator to continue as the appointed adjudicator, the
                         adjudicator's appointment ceases;
                    (c) the applicant may again apply for adjudication in
15                       accordance with section 26(1); and
                   (d) the period commencing on the date when the adjudicator
                         was served with the application for adjudication and
                         ending on and including the date when the adjudicator
                         notifies the parties under paragraph (a) does not count
20                       for the purposes of section 26(1).
           (3)   A party to a payment dispute may apply to the State
                 Administrative Tribunal for a declaration that an appointed
                 adjudicator is disqualified under subsection (1).
           (4)   The application must be made before the person is notified of a
25               decision or determination made under section 31(2).

                        Division 3 -- The adjudication process
     30.         Object of the adjudication process
                 The object of an adjudication of a payment dispute is to
                 determine the dispute fairly and as quickly, informally and
30               inexpensively as possible.


                                                                           page 17
     Construction Contracts Bill 2004
     Part 3         Adjudication of disputes
     Division 3     The adjudication process
     s. 31



     31.         Adjudicator's functions
           (1)   In this section --
                 "prescribed time" means --
                      (a) if the appointed adjudicator is served with a response
 5                           under section 27(1) -- 14 days after the date of the
                             service of the response;
                      (b) if the appointed adjudicator is not served with a
                             response under section 27(1) -- 14 days after the last
                             date on which a response is required to be served
10                           under section 27(1).
           (2)   An appointed adjudicator must, within the prescribed time or
                 any extension of it made under section 32(3)(a) --
                   (a) dismiss the application without making a determination
                        of its merits if --
15                         (i) the contract concerned is not a construction
                                contract;
                          (ii) the application has not been prepared and served
                                in accordance with section 26;
                         (iii) an arbitrator or other person or a court or other
20                              body dealing with a matter arising under a
                                construction contract makes an order, judgment
                                or other finding about the dispute that is the
                                subject of the application; or
                         (iv) satisfied that it is not possible to fairly make a
25                              determination because of the complexity of the
                                matter or the prescribed time or any extension of
                                it is not sufficient for any other reason;
                   (b) otherwise, determine on the balance of probabilities
                        whether any party to the payment dispute is liable to
30                      make a payment, or to return any security and, if so,
                        determine --
                           (i) the amount to be paid or returned and any
                                interest payable on it under section 33; and

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                                             Adjudication of disputes        Part 3
                                            The adjudication process    Division 3
                                                                               s. 32



                          (ii)   the date on or before which the amount is to be
                                 paid, or the security is to be returned, as the case
                                 requires.
           (3)   If an application is not dismissed or determined under
 5               subsection (2) within the prescribed time, or any extension of it
                 made under section 32(3)(a), the application is to be taken to
                 have been dismissed when the time has elapsed.

     32.         Adjudication procedure
           (1)   For the purposes of making a determination, an appointed
10               adjudicator --
                   (a) must act informally and if possible make the
                         determination on the basis of --
                           (i)   the application and its attachments; and
                          (ii)   if a response has been prepared and served in
15                               accordance with section 27, the response and its
                                 attachments;
                        and
                  (b)   is not bound by the rules of evidence and may inform
                        himself or herself in any way he or she thinks fit.
20         (2)   In order to obtain sufficient information to make a
                 determination, an appointed adjudicator may --
                   (a) request a party to make a, or a further, written
                         submission or to provide information or documentation,
                         and may set a deadline for doing so;
25                 (b) request the parties to attend a conference with the
                         adjudicator;
                   (c) unless all the parties object --
                           (i) inspect any work or thing to which the payment
                                 dispute relates, provided the occupier of any
30                               place concerned consents to the entry and
                                 inspection;


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     Construction Contracts Bill 2004
     Part 3         Adjudication of disputes
     Division 3     The adjudication process
     s. 33



                          (ii)   arrange for any thing to which the payment
                                 dispute relates to be tested, provided the owner
                                 of the thing consents to the testing;
                         (iii)   engage an expert to investigate and report on any
 5                               matter relevant to the payment dispute.
           (3)   An appointed adjudicator may --
                  (a) with the consent of the parties, extend the time
                       prescribed by section 31(2) for making a determination;
                  (b)    with the consent of the parties, adjudicate
10                       simultaneously 2 or more payment disputes between the
                         parties;
                   (c)   with the consent of all the parties concerned, adjudicate
                         the payment dispute simultaneously with another
                         payment dispute.
15         (4)   If an appointed adjudicator adjudicates simultaneously 2 or
                 more payment disputes, the adjudicator may, in adjudicating
                 one, take into account information the adjudicator receives in
                 relation to the other, and vice versa.
           (5)   An adjudicator's power to make a determination is not affected
20               by the failure of either or both of the parties to make a
                 submission or provide information within time or to comply
                 with the adjudicator's request to attend a conference with the
                 adjudicator.
           (6)   To the extent that the practice and procedure in relation to
25               adjudications is not regulated by this Part or the regulations, an
                 appointed adjudicator may determine his or her own procedure.
     33.         Interest up to determination
           (1)   If an appointed adjudicator determines that a party to a payment
                 dispute is liable to make a payment, he or she may also
30               determine that interest is to be paid --
                    (a) if the payment is overdue under the construction
                         contract, on the payment in accordance with the
                         contract; or

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                                                  Construction Contracts Bill 2004
                                            Adjudication of disputes        Part 3
                                           The adjudication process    Division 3
                                                                              s. 34



                  (b)   otherwise, on the whole or a part of the payment from
                        the date the payment dispute arose at a rate not greater
                        than the rate prescribed under the Supreme Court
                        Act 1935 section 142,
 5               until and including the date of the determination.
           (2)   Subsection (1) does not authorise the awarding of interest upon
                 interest.
     34.         Costs of parties to payment disputes
           (1)   Subject to subsection (2), parties to a payment dispute bear their
10               own costs in relation to an adjudication of the dispute.
           (2)   If an appointed adjudicator is satisfied that a party to a payment
                 dispute incurred costs of the adjudication because of frivolous
                 or vexatious conduct on the part of, or unfounded submissions
                 by, another party, the adjudicator may decide that the other
15               party must pay some or all of those costs.
           (3)   If an appointed adjudicator makes a decision under
                 subsection (2) the adjudicator must --
                    (a) decide the amount of the costs and the date on which the
                         amount is payable;
20                 (b) give reasons for the decisions; and
                    (c) communicate the decisions and the reasons in writing to
                         the parties.
           (4)   Divisions 4 and 5, with any necessary changes, apply to a
                 decision made under subsection (2) as if it were a determination
25               of an appointed adjudicator.
     35.         Certificates of completion etc., effect of
           (1)   This section applies if --
                  (a) the construction contract to which a payment dispute
                        relates provides for a person to certify --
30                         (i) that obligations under the contract have been
                                performed; or

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     Construction Contracts Bill 2004
     Part 3         Adjudication of disputes
     Division 3     The adjudication process
     s. 36



                          (ii)   the amount of a payment that is to be made by a
                                 party;
                         and
                  (b)    such a certificate is provided by a party to an adjudicator
 5                       in the course of an adjudication.
           (2)   For the purposes of the adjudication --
                  (a) if the certificate relates to the final amount payable
                         under the contract and has the effect of finalising the
                         contract, the certificate is to be taken to be conclusive
10                       evidence of its contents;
                  (b) in any other case the certificate is to have such
                         evidentiary weight as the appointed adjudicator thinks
                         fit.

     36.         Determination, content of
15               An appointed adjudicator's decision made under
                 section 31(2)(b) must --
                   (a) be in writing;
                   (b) be prepared in accordance with, and contain the
                         information prescribed by, the regulations;
20                 (c) state --
                            (i) the amount to be paid and the date on or before
                                 which it is to be paid; or
                           (ii) the security to be returned and the date on or
                                 before which it is to be returned,
25                       as the case requires;
                   (d) give reasons for the determination;
                   (e) identify any information in it that, because of its
                         confidential nature, is not suitable for publication by the
                         Registrar under section 50;
30                  (f) be given to the parties to the adjudication; and
                   (g) be given to the Registrar.

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                                                  Construction Contracts Bill 2004
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                                            Effect of determinations   Division 4
                                                                              s. 37



     37.         Dismissed applications
           (1)   If under section 31(2)(a) an appointed adjudicator dismisses an
                 application for adjudication, he or she must --
                    (a) give reasons for doing so; and
 5                 (b) communicate the decision and the reasons in writing to
                         the parties.
           (2)   If under section 31(3) an application for an adjudication of a
                 payment dispute is taken to be dismissed --
                    (a) nothing in this Part prevents a further application being
10                       made under this Part for an adjudication of the dispute;
                         and
                   (b) any further application must be made within 28 days
                         after the previous application is taken to be dismissed
                         under section 31(3).

15                     Division 4 -- Effect of determinations
     38.         Determinations have effect despite other proceedings
                 An appointed adjudicator's determination is binding on the
                 parties to the construction contract under which the payment
                 dispute concerned arose even though other proceedings relating
20               to the payment dispute have been commenced before an
                 arbitrator or other person or a court or other body.

     39.         Payment of amount determined and interest
           (1)   A party that is liable to pay an amount under a determination
                 must do so on or before the date specified in the determination.
25         (2)   Unless the determination provides otherwise, interest at the rate
                 prescribed under the Supreme Court Act 1935 section 142 is to
                 be paid on such of the amount as is unpaid after the date
                 specified in the determination.
           (3)   The interest to be paid under subsection (2) forms part of the
30               determination.

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     Construction Contracts Bill 2004
     Part 3         Adjudication of disputes
     Division 4     Effect of determinations
     s. 40



           (4)   If under section 43(2) a judgment is entered in the terms of a
                 determination, interest under subsection (2) ceases to accrue.

     40.         Progress payments under determinations to be on account
                 If --
 5                  (a)   an appointed adjudicator --
                             (i) determines a payment dispute concerning a claim
                                  by a contractor for payment for part performance
                                  of its obligations but not for a final payment by
                                  the principal; and
10                          (ii) determines that the principal is to pay the
                                  contractor an amount in respect of the claim;
                          and
                   (b)    the principal, in accordance with the determination, pays
                          the amount,
15               the payment is to be taken to be an advance towards the total
                 amount payable under the contract by the principal to the
                 contractor.

     41.         Determinations are final
           (1)   If on the adjudication of a payment dispute the appointed
20               adjudicator makes a determination --
                    (a) the adjudicator cannot subsequently amend or cancel the
                         determination except with the consent of the parties; and
                   (b) a party to the dispute may not apply subsequently for an
                         adjudication of the dispute.
25         (2)   Despite subsection (1)(a), if an adjudicator's determination
                 contains --
                   (a) an accidental slip or omission;
                   (b) a material arithmetic error; or




     page 24
                                                    Construction Contracts Bill 2004
                                              Adjudication of disputes        Part 3
                                             Enforcing determinations    Division 5
                                                                                s. 42



                   (c)     a material mistake in the description of any person, thing
                           or matter,
                 the adjudicator, on the application of a party or, after notifying
                 the parties, on the adjudicator's own initiative, may correct the
 5               determination.

                         Division 5 -- Enforcing determinations
     42.         Non-compliance by principal, contractor may suspend its
                 obligations
           (1)   If a determination requires the principal to pay the contractor an
10               amount and the principal does not pay in accordance with the
                 determination, the contractor may give the principal notice of
                 the contractor's intention to suspend the performance of its
                 obligations.
           (2)   The notice must --
15                (a) be in writing;
                  (b) be prepared in accordance with, and contain the
                        information prescribed by, the regulations;
                  (c) state the date on which the contractor intends to suspend
                        the performance of its obligations; and
20                (d) be given to the principal at least 3 days before that date.
           (3)   If on the date stated under subsection (2)(c) in the notice the
                 principal has not paid the contractor the amount in accordance
                 with the determination, the contractor may suspend the
                 performance of its obligations until no longer than 3 days after
25               the date on which the amount is paid.
           (4)   Subsection (3) does not prevent the contractor from at any time
                 resuming the performance of its obligations.
           (5)   A contractor that suspends the performance of its obligations in
                 accordance with this section --
30                 (a) is not liable for any loss or damage suffered by the
                        principal or by any person claiming through the
                        principal; and

                                                                             page 25
     Construction Contracts Bill 2004
     Part 3         Adjudication of disputes
     Division 6     General
     s. 43



                  (b)    retains its rights under the contract, including any right
                         to terminate the contract.

     43.         Determinations may be enforced as judgments
           (1)   In this section --
 5               "court of competent jurisdiction", in relation to a
                      determination, means a court with jurisdiction to deal with
                      a claim for the recovery of a debt of the same amount as the
                      amount that is payable under the determination.
           (2)   A determination may, with the leave of a court of competent
10               jurisdiction, be enforced in the same manner as a judgment or
                 order of the court to the same effect, and if such leave is given,
                 judgment may be entered in terms of the determination.
           (3)   For the purposes of subsection (2), a determination signed by an
                 adjudicator and certified by the Registrar as having been made
15               by a registered adjudicator under this Part is to be taken as
                 having been made under this Part.

                                 Division 6 -- General
     44.         Costs of adjudications
           (1)   For the purposes of this section the costs of an adjudication
20               are --
                   (a) the entitlements of the appointed adjudicator under
                         subsection (2); and
                   (b) the costs of any testing done, or of any expert engaged,
                         under section 32(2)(c).
25         (2)   If an appointed adjudicator, within the prescribed time in
                 section 31(2), dismisses an application for adjudication or
                 makes a determination of the dispute, he or she is entitled --
                    (a) to be paid for his or her work --
                           (i) at a rate agreed between the adjudicator and the
30                               parties that is not more than the maximum rate, if
                                 any, prescribed by the regulations; or

     page 26
                                              Construction Contracts Bill 2004
                                        Adjudication of disputes        Part 3
                                                        General    Division 6
                                                                          s. 44



                     (ii)   if a rate was not agreed, at the rate published
                            under section 51 in respect of the adjudicator;
                    and
             (b)    to be reimbursed any expenses reasonably incurred in
 5                  connection with that work.
      (3)   An appointed adjudicator who is disqualified under section 29
            has the entitlements in subsection (2) in respect of any
            adjudication work done before the disqualification is notified to
            the parties.
10    (4)   Despite subsection (2), an appointed adjudicator may refuse to
            communicate his or her decision or determination under
            section 31(2) or 34(2) or subsection (10) until he or she has
            been paid and reimbursed in accordance with subsection (2).
      (5)   The parties involved in a payment dispute are jointly and
15          severally liable to pay the costs of an adjudication of the
            dispute.
      (6)   As between themselves, the parties involved in a dispute are
            liable to pay the costs of an adjudication of the dispute in equal
            shares.
20    (7)   Subsections (5) and (6) do not prevent a decision being made
            under section 34(2).
      (8)   An appointed adjudicator may at any time require one or more
            parties to provide a reasonable deposit, or reasonable security,
            for the, or any anticipated costs of the adjudication.
25    (9)   A prescribed appointor, before appointing an adjudicator, may
            require the applicant for adjudication to provide a deposit, or
            reasonable security, for the, or any anticipated costs of the
            adjudication.
     (10)   If a party involved in a dispute has paid more than the party's
30          share of the costs of an adjudication of the dispute, having
            regard to subsection (6), the appointed adjudicator may decide
            that another party must pay to the first-mentioned party such

                                                                          page 27
     Construction Contracts Bill 2004
     Part 3         Adjudication of disputes
     Division 6     General
     s. 45



                 amount of the costs as would result in all the parties paying an
                 equal amount of the costs.
       (11)      If an appointed adjudicator makes a decision under
                 subsection (10) --
 5                  (a) the adjudicator must include in the decision the date on
                         which the amount is payable; and
                   (b) Divisions 4 and 5, with any necessary changes, apply to
                         the decision as if it were a determination of an appointed
                         adjudicator.
10     (12)      An appointed adjudicator may recover the costs of an
                 adjudication from a person liable to pay the costs in a court of
                 competent jurisdiction as if the costs were a debt due to the
                 adjudicator.

     45.         Effect of this Part on civil proceedings
15         (1)   This Part does not prevent a party to a construction contract
                 from instituting proceedings before an arbitrator or other person
                 or a court or other body in relation to a dispute or other matter
                 arising under the contract.
           (2)   If other such proceedings are instituted in relation to a payment
20               dispute that is being adjudicated under this Part, the
                 adjudication is to proceed despite those proceedings unless all
                 of the parties, in writing, require the appointed adjudicator to
                 discontinue the adjudication.
           (3)   Evidence of anything said or done in an adjudication is not
25               admissible before an arbitrator or other person or a court or
                 other body, except for the purposes of an application made
                 under section 29(3) or an appeal made under section 46.
           (4)   An arbitrator or other person or a court or other body dealing
                 with a matter arising under a construction contract --
30                (a) must, in making any award, judgment or order, allow for
                        any amount that has been or is to be paid to a party


     page 28
                                                   Construction Contracts Bill 2004
                                             Adjudication of disputes        Part 3
                                                             General    Division 6
                                                                               s. 46



                         under a determination of a payment dispute arising
                         under the contract; and
                  (b)    may make orders for the restitution of any amount so
                         paid, and any other appropriate orders as to such a
 5                       determination.

     46.         Review, limited right of
           (1)   A person who is aggrieved by a decision made under
                 section 31(2)(a) may apply to the State Administrative Tribunal
                 for a review of the decision.
10         (2)   If, on a review, a decision made under section 31(2)(a) is set
                 aside and, under the State Administrative Tribunal Act 2004
                 section 29(3)(c)(i) or (ii), is reversed the adjudicator is to make
                 a determination under section 31(2)(b) within 14 days after the
                 date on which the decision under section 31(2)(a) was reversed
15               or any extension of that time consented to by the parties.
           (3)   Except as provided by subsection (1) a decision or
                 determination of an adjudicator on an adjudication cannot be
                 appealed or reviewed.




                                                                             page 29
     Construction Contracts Bill 2004
     Part 4         Administration

     s. 47



                            Part 4 -- Administration
     47.         Registrar, appointment and functions
           (1)   There is to be an office called the Construction Contracts
                 Registrar or such other name as the Minister declares by a
 5               notice in the Gazette.
           (2)   The Minister, by a notice in the Gazette, is to designate a public
                 service officer (as defined in the Public Sector Management
                 Act 1994 section 3(1)) to be the Registrar.
           (3)   The Registrar's functions are those conferred on the Registrar
10               by this Act.
           (4)   A document purporting to be signed by the Registrar is to be
                 taken to have been signed by a person who was at the time duly
                 appointed as the Registrar, in the absence of evidence to the
                 contrary.

15   48.         Registering adjudicators
           (1)   An individual is eligible to be a registered adjudicator if he or
                 she has the qualifications and experience prescribed by the
                 regulations.
           (2)   The Registrar may register an individual as a registered
20               adjudicator --
                   (a) on the application of an individual; or
                   (b) on the nomination of a prescribed appointor.
           (3)   The regulations may prescribe a fee to be paid on making such
                 an application or nomination.
25         (4)   The Registrar must not register an individual as a registered
                 adjudicator unless satisfied that the individual is eligible to be
                 registered.




     page 30
                                                   Construction Contracts Bill 2004
                                                     Administration          Part 4

                                                                                 s. 49



           (5)   The Registrar may cancel the registration of an individual as a
                 registered adjudicator if satisfied that the individual --
                   (a) has ceased to be eligible to be registered;
                   (b) has misconducted, or is incompetent or unsuitable to
 5                       conduct, adjudications under Part 3.
           (6)   The Registrar must keep a register of registered adjudicators and
                 make it available for public inspection at no charge.
           (7)   A certificate by the Registrar stating that an individual was or
                 was not at a time or in a period, or is or is not, a registered
10               adjudicator is proof of the content of the certificate in the
                 absence of evidence to the contrary.

     49.         Review of registration decisions
                 A person who is aggrieved by a decision of the Registrar made
                 under section 48 may apply to the State Administrative Tribunal
15               for a review of the decision.

     50.         Publication of adjudicators' decisions
           (1)   The Registrar may make available for public inspection the
                 result, or a report, of the decisions of registered adjudicators.
           (2)   The Registrar is to ensure that there is not included in the result,
20               or a report, of the determination made available under
                 subsection (1) --
                   (a) the identities of the parties to the adjudication;
                   (b) any information in the determination that is identified
                         under section 36(e) as being not suitable for publication
25                       because of its confidential nature.
           (3)   No charge is payable for inspecting the result, or a report, of a
                 determination made available under subsection (1).




                                                                              page 31
     Construction Contracts Bill 2004
     Part 4         Administration

     s. 51



     51.         Appointors' and adjudicators' rates to be published
           (1)   A registered adjudicator is to ensure that the rate at which the
                 adjudicator charges for his or her work under this Act is
                 published in a manner approved by the Registrar.
 5         (2)   A prescribed appointor is to ensure that the rate at which the
                 appointor charges for its work under this Act is published in a
                 manner approved by the Registrar.
           (3)   Nothing in subsection (1) or (2) prevents any of the parties from
                 agreeing the rate to be charged by a registered adjudicator or a
10               prescribed appointor for work under this Act.
           (4)   A published or agreed rate as referred to in this section is not to
                 be more than the maximum rate, if any, prescribed by the
                 regulations.

     52.         Annual report
15               Before 1 November in each year, the Registrar must give the
                 Minister a written report about the operation and effectiveness
                 of this Act in the financial year that ended in that year.




     page 32
                                                   Construction Contracts Bill 2004
                                                     Miscellaneous           Part 5

                                                                                s. 53



                             Part 5 -- Miscellaneous
     53.         No contracting out
           (1)   A provision in an agreement or arrangement, whether a
                 construction contract or not and whether in writing or not, that
 5               purports to exclude, modify or restrict the operation of this Act
                 has no effect.
           (2)   A provision in an agreement or arrangement that has no effect
                 because of subsection (1) does not prejudice or affect the
                 operation of other provisions of the agreement or arrangement.
10         (3)   Any purported waiver, whether in a construction contract or not
                 and whether in writing or not, of an entitlement under this Act
                 has no effect.

     54.         Immunity from tortious liability
           (1)   In this section --
15               "protected person" means an appointed adjudicator, a
                      prescribed appointor or the Registrar.
           (2)   In this section, a reference to the doing of anything includes a
                 reference to an omission to do anything.
           (3)   An action in tort does not lie against a protected person for
20               anything that the person has done, in good faith, in the
                 performance or purported performance of a function under this
                 Act.
           (4)   The protection given by subsection (3) applies even though the
                 thing done as described in that subsection may have been
25               capable of being done whether or not this Act has been enacted.
           (5)   Despite subsection (3), the State is not relieved of any liability
                 that it might have for the Registrar having done anything as
                 described in that subsection.




                                                                             page 33
     Construction Contracts Bill 2004
     Part 5         Miscellaneous

     s. 55



     55.         Regulations
           (1)   The Governor may make regulations prescribing all matters that
                 are required or permitted by this Act to be prescribed, or are
                 necessary or convenient to be prescribed for giving effect to the
 5               purposes of this Act.
           (2)   Without limiting subsection (1), the regulations may regulate
                 the practice and procedure in adjudications.

     56.         Review of Act
           (1)   As soon as practicable after the fifth anniversary of its
10               commencement, the Minister must review the operation and
                 effectiveness of this Act and prepare a report about the review.
           (2)   As soon as practicable after preparing the report, the Minister
                 must cause it to be laid before each House of Parliament.




     page 34
                                                     Construction Contracts Bill 2004



                                                    Implied provisions       Schedule 1



                        Schedule 1 -- Implied provisions
                                                                             [s. 13 to 22]

                                Division 1 -- Variations

     1.         Variations must be agreed
 5              The contractor is not bound to perform any variation of its obligations
                unless the contractor and the principal have agreed on --
                  (a) the nature and extent of the variation of those obligations; and
                  (b)   the amount, or a means of calculating the amount, that the
                        principal is to pay the contractor in relation to the variation of
10                      those obligations.

                 Division 2 -- Contractor's entitlement to be paid

     2.         Contractor entitled to be paid
          (1)   The contractor is entitled to be paid a reasonable amount for
                performing its obligations.
15        (2)   Subclause (1) applies whether or not the contractor performs all of its
                obligations.

                     Division 3 -- Claims for progress payments

     3.         Entitlement to claim progress payments
                The contractor is entitled to make one or more claims for a progress
20              payment in relation to those of the contractor's obligations that the
                contractor has performed and for which it has not been paid by the
                principal.

     4.         When claims for progress payments can be made
          (1)   A claim by the contractor for a progress payment can be made at any
25              time after the contractor has performed any of its obligations.
          (2)   The making of a claim for a progress payment does not prevent the
                contractor from making any other claim for moneys payable to the
                contractor under or in connection with this contract.


                                                                                 page 35
     Construction Contracts Bill 2004



     Schedule 1           Implied provisions



                        Division 4 -- Making claims for payment

     5.         Claim for payment, content
          (1)   In this clause --
                "payment claim" means a claim --
 5                      (a)      by the contractor to the principal for payment of an
                                 amount in relation to the performance by the contractor of
                                 its obligations under this contract; or
                        (b)      by the principal to the contractor for payment of an
                                 amount in relation to the performance or non-performance
10                               by the contractor of its obligations under this contract.
          (2)   A payment claim must --
                  (a) be in writing;
                  (b)         be addressed to the party to which the claim is made;
                  (c)         state the name of the claimant;
15                (d)         state the date of the claim;
                  (e)         state the amount claimed;
                  (f)     in the case of a claim by the contractor -- itemise and
                          describe the obligations that the contractor has performed and
                          to which the claim relates in sufficient detail for the principal
20                        to assess the claim;
                  (g)     in the case of a claim by the principal -- describe the basis
                          for the claim in sufficient detail for the contractor to assess
                          the claim;
                  (h)     be signed by the claimant; and
25                (i)     be given to the party to which the claim is made.
          (3)   In the case of a claim by the contractor, the amount claimed in a
                payment claim --
                  (a)         must be calculated in accordance with this contract; or
                  (b)         if this contract does not provide a means of calculating the
30                            amount, must be --
                                 (i) if this contract says that the principal is to pay the
                                       contractor one amount (the "contract sum") for the
                                       performance by the contractor of all of its obligations

     page 36
                                                           Construction Contracts Bill 2004



                                                          Implied provisions       Schedule 1



                                       under this contract (the "total obligations") -- the
                                       proportion of the contract sum that is equal to the
                                       proportion that the obligations performed and
                                       detailed in the claim are of the total obligations;
 5                             (ii)    if this contract says that the principal is to pay the
                                       contractor in accordance with rates specified in this
                                       contract -- the value of the obligations performed
                                       and detailed in the claim calculated by reference to
                                       those rates; or
10                             (iii)   in any other case -- a reasonable amount for the
                                       obligations performed and detailed in the claim.
          (4)   Paragraph (b) of subclause (3) does not prevent the amount claimed in
                a progress claim from being an aggregate of amounts calculated under
                one or more of subparagraphs (i), (ii) and (iii) of that paragraph.

15                Division 5 -- Responding to claims for payment

     6.         Interpretation in Division 5
                In this Division --
                "payment claim" means a claim --
                        (a)      by the contractor to the principal for payment of an
20                               amount in relation to the performance by the contractor of
                                 its obligations under this contract; or
                        (b)      by the principal to the contractor for payment of an
                                 amount in relation to the performance or non-performance
                                 by the contractor of its obligations under this contract.

25   7.         Responding to a payment claim
          (1)   If a party that receives a payment claim --
                  (a)         believes the claim should be rejected because the claim has
                              not been made in accordance with this contract; or
                  (b)         disputes the whole or part of the claim,
30              the party must, within 14 days after receiving the claim, give the
                claimant a notice of dispute.




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     Schedule 1         Implied provisions



          (2)   A notice of dispute must --
                  (a) be in writing;
                  (b)   be addressed to the claimant;
                  (c)   state the name of the party giving the notice;
 5                (d)   state the date of the notice;
                  (e)   identify the claim to which the notice relates;
                  (f)   if the claim is being rejected under subclause (1)(a) -- state
                        the reasons for the belief that the claim has not been made in
                        accordance with this contract;
10                (g)   if the claim is being disputed under subclause (1)(b) --
                        identify each item of the claim that is disputed and state, in
                        relation to each of those items, the reasons for disputing it;
                        and
                  (h)   be signed by the party giving the notice.
15        (3)   Within 28 days after a party receives a payment claim, the party must
                do one of the following, unless the claim has been rejected or wholly
                disputed in accordance with subclause (1) --
                  (a) pay the part of the amount of the claim that is not disputed;
                  (b)   pay the whole of the amount of the claim.
20        (4)   If under this contract the principal is entitled to retain a portion of any
                amount payable by the principal to the contractor --
                   (a) subclause (3) does not affect the entitlement; and
                  (b)   the principal must advise the contractor in writing (either in a
                        notice of dispute or separately) of any amount retained under
25                      the entitlement.

                     Division 6 -- Interest on overdue payments

     8.         Interest payable on overdue payments
          (1)   Interest is payable on so much of an amount that is payable under this
                contract by a party to another party on or before a certain date but
30              which is unpaid after that date.




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                                                           Implied provisions      Schedule 1



           (2)   The interest is to be paid for the period beginning on the day after the
                 date on which the amount is due and ending on and including the date
                 on which the amount payable is paid.
           (3)   The rate of interest at any time is equal to that prescribed for that time
 5               under the Supreme Court Act 1935 section 142.

                                  Division 7 -- Ownership of goods

     9.          When ownership of goods supplied by contractor passes
                 The ownership of goods that are --
                   (a) related to construction work; and
10                 (b)          supplied to the site of the construction work by the contractor
                                under its obligations under this contract,
                 passes from the contractor when whichever of the following happens
                 first --
                    (c) when the contractor is paid for the goods; or
15                 (d)          when the goods become fixtures.

                 Division 8 -- Duties as to unfixed goods on insolvency

     10.         Duties of principal or landowner etc. as to unfixed goods on
                 insolvency
           (1)   In this clause --
20               "insolvent" means --
                          (a)      in relation to a natural person, an insolvent under
                                   administration as that term is defined in the Corporations
                                   Act 2001 of the Commonwealth;
                          (b)      in relation to a body corporate, an externally-administered
25                                 body corporate as that term is defined in the Corporations
                                   Act 2001 of the Commonwealth.
           (2)   If --
                    (a)         goods that are related to construction work have been
                                supplied to the site of the construction work by the contractor
30                              under its obligations under this contract;
                   (b)          the contractor has not been paid for the goods;

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     Schedule 1         Implied provisions



                  (c)   the goods have not become fixtures;
                  (d)   ownership of the goods has not passed from the contractor;
                  (e)   the goods are in the possession of or under the control of --
                           (i)   the principal; or
 5                        (ii)   a person for whom, directly or indirectly, the
                                 principal is performing construction work or to
                                 whom, directly or indirectly, the principal is
                                 supplying goods and services that are related to
                                 construction work;
10                      and
                  (f)   the principal or that person becomes an insolvent,
               the principal and that person --
                 (g) must not, during the insolvency, allow the goods to become
                        fixtures or to fall into the possession of or under the control
15                      of any other person, other than the contractor, except with the
                        prior written consent of the contractor; and
                 (h) must allow the contractor a reasonable opportunity to
                        repossess the goods.
                              Division 9 -- Retention money
20   11.       Retention money to be held on trust
               If the principal retains from an amount payable by the principal to the
               contractor for the performance by the contractor of its obligations a
               portion of that amount (the "retention money"), the principal holds
               the retention money on trust for the contractor until whichever of the
25             following happens first --
                  (a) the money is paid to the contractor;
                  (b)   the contractor, in writing, agrees to give up any claim to the
                        money;
                  (c)   the money ceases to be payable to the contractor by virtue of
30                      the operation of this contract; or
                  (d)   an adjudicator, arbitrator, or other person, or a court, tribunal
                        or other body, determines that the money ceases to be payable
                        to the contractor.



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                                                                                                  Defined Terms



                                       Defined Terms
      [This is a list of terms defined and the provisions where they are defined.
                             The list is not part of the law.]
Defined Term                                                                                              Provision(s)
adjudication...........................................................................................................3
applicant................................................................................................................3
appointed adjudicator............................................................................................3
civil works........................................................................................................ 4(1)
construction contract.............................................................................................3
construction work................................................................................ 3, 4(2), 4(4)
contract sum.................................................................................... Sch. 1, cl. 5(3)
contractor ..............................................................................................................3
costs of an adjudication.........................................................................................3
court of competent jurisdiction ...................................................................... 43(1)
determination ........................................................................................................3
insolvent........................................................................................ Sch. 1, cl. 10(1)
obligations.............................................................................................................3
party ......................................................................................................................3
payment claim.........................................................3, Sch. 1, cl. 5(1), Sch. 1, cl. 6
payment dispute ....................................................................................................3
prescribed appointor .............................................................................................3
prescribed time............................................................................................... 31(1)
principal ................................................................................................................3
protected person............................................................................................. 54(1)
registered adjudicator............................................................................................3
Registrar................................................................................................................3
retention money .................................................................................Sch. 1, cl. 11
site in WA ........................................................................................................ 4(1)
total obligations............................................................................... Sch. 1, cl. 5(3)




 


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