Avoiding Security of Payment pitfalls #1: Identifying parties to a contract

Adjudication and Security of Payment can often involve complex contractual disputes and significant sums of money

Source: Concreate housing.
Source: Concrete forms (CC BY 2.0).

However, making sure you have considered all the requirements of security of payment legislation and paying attention to the small but important details of security of payment legislation is vitally important to being successful in adjudication.

Aspects of the legislative requirements under security of payment that may seem small or inconsequential really should not be ignored at the expense of what you may think are more important issues in your adjudication application.

With those points in mind, the ABC DRS presents a series of news posts on reminding you how important some of these more basic considerations of security of payment are when putting together a payment claim or adjudication application.

Our first post is below and deals with how important to identifying parties to the construction contract is in terms of adjudication applications and the outcomes of the security of payment process.

*Disclaimer*: Before, we jump into the list, it should be noted that the following information does not constitute professional legal advice or guidance. Readers should consult their legal representation before acting on any of the content presented below.

Identifying parties to the contract

It seems obvious, but often those involved in a construction contract are not one hundred percent aware of whom they may actually be legally contracted with.

When in doubt, you should go back to the original documentation to determine whom the adjudication application, or even payment claim, should be directed towards.

Remember, claimants are required to make a claim against those parties liable to make payment. This may not be the person you have traditionally exchanged communication with, or who may have made payment on your invoices in the past.

It is also vital to keep track of all relevant Australian Business Numbers (A.B.N) in the contract documents. The Australian government also provide a handy online tool for looking up A.B.Ns that can be useful in tracking down who you may be contracted with.

Making sure you’re communicating with the right entity is vital part of the security of payment process. If you overlook this aspect of using security of payment, you may find your adjudication application may get snagged by jurisdictional issues – thus costing you time and money. So it makes good business sense to ensure that you really know your construction contract before engaging security of payment processes.

There are plenty more helpful tips on construction contracts in the ABC DRS adjudication centre on this website.

If you would like more specialised training in security of payment, ABC DRS offer intensive one day training events throughout Australia. Head on over to our training page to find out more.

You’re also more than welcome to get in touch should you require further guidance.

Stay tuned to the ABC DRS news site when we bring you more important factors in making successful adjudication applications later this week.

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