The Construction Contracts Act 2013, will come into force for all Construction Contracts entered into after the 25th July 2016. With its introduction comes a plethora of new terminology for the industry to both understand but now to also religiously stick to. We say goodbye to the term valuation which has been replaced with the term “Payment Claim Notice” and a new term of a “Payment Claim Date” has been introduced. So what do they mean?
Payment Claim Date
The payment claim date is the date when a payment claim is required to be made. This date must be agreed at the time of commencement of the contract or at least a mechanism for calculating same otherwise the Schedule of the Construction Contracts Act will apply. When it comes to subcontracts the Schedule applies in all instances unless the terms agreed are more favourable to the subcontractor.
The schedule states that the payment claim date is 30 days after the commencement date in the contract and every 30 days thereafter up to the date of substantial completion and then 30 days after the date of final completion. Why is this date important? Well in accordance with section 4 of the Act, in order to receive the protection (based on the current untested wording of the ACT) of the ACT, a contractor has 5 days from the Payment Claim Date with which to issue a Payment Claim Notice. The schedule to the Act also states that no payment due under a Construction Contract can be made later than 30 days from the Payment Claim Date. It will therefore be, for contractors and subcontractors to regimentally submit their payment claims within a tight period of time into the future as opposed to the generally loose and haphazard methods that valuations are currently submitted, whilst also providing a tighter window for the receiving party to the Contract to deal with and certify the payment.
Payment Claim Notice
The introduction of a Payment Claim Notice in the Act must be seen as an apparent attempt to formalise and standardise a payment request process in the Irish Construction industry. For those currently working in the area of payment certification, the attempt to standardise the information that must be submitted will generally be welcomed. A Payment Claim Notice is a notice which specifies:
Time will tell how the industry reacts to the new requirements and obligations.
Keith Kelliher is an Accredited Adjudicator, who has completed the diploma in Adjudication in University College Dublin, specifically on the Construction Contracts Act 2013, and has represented Main Contractors and Sub-Contractors in payment disputes for over 15 years in the Irish construction industry. Contact Keith at [email protected] for any assistance with the requirements of the ACT.
Payment Claim Date
The payment claim date is the date when a payment claim is required to be made. This date must be agreed at the time of commencement of the contract or at least a mechanism for calculating same otherwise the Schedule of the Construction Contracts Act will apply. When it comes to subcontracts the Schedule applies in all instances unless the terms agreed are more favourable to the subcontractor.
The schedule states that the payment claim date is 30 days after the commencement date in the contract and every 30 days thereafter up to the date of substantial completion and then 30 days after the date of final completion. Why is this date important? Well in accordance with section 4 of the Act, in order to receive the protection (based on the current untested wording of the ACT) of the ACT, a contractor has 5 days from the Payment Claim Date with which to issue a Payment Claim Notice. The schedule to the Act also states that no payment due under a Construction Contract can be made later than 30 days from the Payment Claim Date. It will therefore be, for contractors and subcontractors to regimentally submit their payment claims within a tight period of time into the future as opposed to the generally loose and haphazard methods that valuations are currently submitted, whilst also providing a tighter window for the receiving party to the Contract to deal with and certify the payment.
Payment Claim Notice
The introduction of a Payment Claim Notice in the Act must be seen as an apparent attempt to formalise and standardise a payment request process in the Irish Construction industry. For those currently working in the area of payment certification, the attempt to standardise the information that must be submitted will generally be welcomed. A Payment Claim Notice is a notice which specifies:
- The amount claimed (even if zero)
- The Period covered by the claim
- The stage of work or activity to which the payment claim relates
- The subject matter of the payment claim
- The basis of the calculation of the amount claimed
Time will tell how the industry reacts to the new requirements and obligations.
Keith Kelliher is an Accredited Adjudicator, who has completed the diploma in Adjudication in University College Dublin, specifically on the Construction Contracts Act 2013, and has represented Main Contractors and Sub-Contractors in payment disputes for over 15 years in the Irish construction industry. Contact Keith at [email protected] for any assistance with the requirements of the ACT.
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