Building Industry Update: Security of Payment Reform

The Queensland Government has proposed significant amendments to the Building Industry Fairness (Security of Payment) Act 2017 (Qld) (BIF Act). The Building Industry Fairness and Other Legislation Amendment Bill 2020 (the Bill) was introduced into the Legislative Assembly on 5 February 2020 following recommendations of the Building Industry Fairness Reforms Implementation and Evaluation Panel and Special Joint Taskforce. The Bill was proposed to commence on 1 July 2020, but this has not yet occurred. The reforms include the following key changes affecting security of payment provisions:

• Replacement of ‘Project Bank Accounts’ with a Project Trust scheme. The new scheme will apply more broadly to the private sector.
• Payment claims to be accompanied by a ‘supporting statement’, declaring that subcontractors have been paid all amounts owed to them or providing reasons why any claims remain unpaid.
• Further protection to claimants by enabling adjudication decisions to be enforced by the making of a ‘payment withholding request ‘against a party higher up the contractual chain.
• Introduction of an offence provision when a scheduled amount is not paid by the due date for payment.

The Bill also introduces several changes affecting building industry consultants. Building certifiers will be subject to a demerit point system which can result in license disqualification. The Bill also introduces additional investigative powers to the BPEQ or the BPAQ when investigating the conduct of architects or registered professional engineers including additional rights of entry, search powers, and powers of seizure.

A copy of the Bill and explanatory notes can be found here. For further information on any of the issues raised in this alert please contact John Carey.