Shane Ririnui Education and Technical Manager
Form 1 - Infor
mation that
must
accompany Section 20, Const all payment claims ruction Contra cts Act 2002
• Write into the contract a designated time of the week, or fortnight, to have the client meet on-site to discuss concerns and view the progress of the build to assist in keeping the client happy.
All of the above scenarios are not valid reasons to withhold paying the final payment claim unless you have committed as part of the contract that you will take care of the final inspection (CCC). It is best to keep your business hat on, and if clients are requesting to take possession of the site, for whatever reason, then they will need to pay the final payment claim. NZCB Building Contracts have conditions in the contract which will facilitate the recovery of this final payment. What is this? This notice is attach
ed to a claim
The person
Important notic e
for a payme nt (a payme
nt claim) under
the Construction who sent this payment claim Contracts Act date under a (the claimant) 2002 (the Act). construction is claiming to contract. be entitled to a payment for, Whether that or in relation person is entitle to, the constr d to a payme uction work have agreed nt, and how carried out to between yourse much they are lves about payme entitled to, will nts. If you haven’ depend on wheth What should t agreed on er you have I do with this Date payments, there are a construction payment claim? You can either— default provisi contract and ons in the Act. what you
Tax Invoice/Payment Claim
Invoice #
• pay the amoun t claimed in the payment claim (in full) • on or before if you disput the due date e the for payment; stating the amounpayment claim, send the or t you are prepar From claimant a written payment schedu ed to pay instead The due date le that compli (which could for a payme es with section be nothing). nt is the date Address 21 of the Act on a due date, agreed betwe (a payment then the Act en you and the schedule) says working day that a payme claimant. That is any day other nt is due within due date must than a Saturd 20 working be set out in days after the ay, a Sunday, the payment a public payment claim claim. If you When do I have is served on haven’t agreed GST Number Job Name/Ref holiday, or any day from 24 to act? you. (For the December to You should act purposes of 5 January.) promptly. Otherw the Act, a ise, you may Due Date for payment lose the right to object. What if I do nothing? If you don’t pay the amoun t claimed by court to recove the due date r the unpaid for payment Building Contract amount from court case. or send a payme you as a debt nt schedule owed. In additio indicating what n, the court you will pay may decide Reference # instead, the Can I say that that you have claimant can I will not pay, to pay the claima go to or pay less than, Yes, by sendin nt’s costs for the claimed bringing the g a written payme Site/Job Address amount? nt schedule. Note: If you do not send a written payme Description of work nt schedule, the claimant can How do I say bring court procee I will not pay, Date period of work dings agains or pay less than, To say that t From you you will To the claimed or refer the pay nothin undertaken You must matter to adjudi amount? g or indicat indicate the cation (or both). e what you amount that If the schedu will pay instead led amount is less than the you are prepared to , you pay, claime which This is a Payment Claim under the Construction Contracts Act 2002. Please read the Important Notice on the reverse. must send the claima d amoun could t, you • be nothing. nt a written must explain how you calcula This amoun in the payme payment schedu ted the schedu t is called nt schedule— le. the schedu led amount; led amoun and t. why the schedu Description of work undertaken • QTY Rate Total led amount is less than the claimed amoun • your reason t; and or reasons for not paying the full amount Note: The written claimed. payment schedu le must also state which payment claim Note: If you state in the the payment payment schedu schedule relates how much is le that you will to. owing for adjudi pay less than cation. the claimed amount or pay How long do nothing at all, I have? the claimant may refer the You must send dispute about a payment schedu on you. le by the date agreed in the contract or, if no date was agreed, within If I say I will 20 working days pay another after the payme amount instea You must still nt claim was d, when do pay the schedu served I have to pay led amount it? by the due date for payment. What if I don’t pay the schedu led amount If you send a when I say I payment schedu will? le but do not you as a debt pay the schedu owed or refer led amount the matter to by the due date, adjudication (or both). the claimant Note: A court can go to court to may also require recover the you to pay the unpaid amoun claimant’s costs. t from Advice
To
• Write into the contract how you will communicate with the client; will it be face to face? over the phone? or via email? I recommend selecting an option where you can record everything said, just in case you need to call upon a particular discussion. • Don’t bury your head in the sand when a client is bringing concerns to your attention, all that will do is frustrate them more and they will begin to question everything. Hear what they have to say and promptly look to resolve it. One last challenge a lot of builders are faced with is what to do when a client defaults on the final payment claim. Here are some of the reasons why this may occur. • The client feels that the work needs to be signed off by the Council before they are happy with the work, and therefore happy to pay the builder. • Banks are requesting that a final inspection (Code Compliance Certificate (CCC)) is to be awarded before releasing funds. • There are questions around some defective work, or the client has workmanship concerns. • The client has taken possession of the site or taken back possession of the site, for which they now have no motivation to pay.
Important: If there is anythi ng in this notice immediately. that you do not understand
Version 042016
Unless otherwise stated above, payment is due 5 Working Days after the Invoice is Served on the Owner. Within 5 working days of the Owner being served with a payment claim, the owner must provide to the Builder a payment schedule.
or if you want advice about what to do, you should consult a lawyer
Subtotal
$
GST
$
TOTAL Claim Amount
$
Version 042016
If you experience a client choosing to withhold the final payment, please don’t hesitate to give me a call on: 0800 237 843 ext 7220 or give Geoff Hardy from Martelli McKegg Lawyers a call on: 09 379 0700. Geoff operates the NZCB Business Legal Helpline, offering 20 minutes of free advice on any legal issue affecting your business. Ngā mihi.
Thank you, Dave
Ian Chamberlain NZCB Board Chairperson
In acknowledgement for contributions to the New Zealand Certified Builders (NZCB) Board, the Association, and the industry, NZCB Board Vice Chairperson Nick Farrelly and NZCB Legal Advisor Geoff Hardy presented past NZCB Board Member Director, Dave Whitehead with a beautiful Koru sculpture. Dave held a Member Director position on the NZCB Board for nine years and continues to contribute to the Association and industry. NZCB Board Vice Chairperson, Nick Farrelly (right), and NZCB Legal Advisor, Geoff Hardy (left), presenting past NZCB Board Member Director, Dave Whitehead (centre) with a beautiful Koru sculpture.
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