The Property Council of New South Wales on the Building And Construction TABLE OF CONTENTS INTRODUCTION 1 MAIN BODY1

ADDRESSING THE PROPERTY
COUNCIL OF NEW SOUTH WALES
ON THE BUILDING AND
CONSTRUCT

TABLE OF CONTENTS
INTRODUCTION ..........................................................................................................................1
MAIN BODY...................................................................................................................................1
1. How does the Act work?.........................................................................................................1
2. Why was it introduced?...........................................................................................................3
3. How does the Act work in relation to the regular court actions?............................................4
4. Recent amendments that have been made to the Act where a subcontractor of the builder
has not been paid by the builder and in particular what rights has the subcontractor in relation
to the owner of the property........................................................................................................5
CONCLUSION................................................................................................................................6
REFERENCES................................................................................................................................7

INTRODUCTION
The present report is prepared to address Property Council of New South Wales on the
Building and Construction Industry Security of Payments Act 1999 and the Building and
Construction Industry Security of Payment Amendment Act 2002. The Act is to strengthen
financial security of people dealing in goods and services for Building and construction industry
through enforcing progress payment form debtors to person who is entitled for it. In the report,
case law used as reference is Castle Constructions Pty Ltd vs Ghossayn Group Pty Ltd [2017]
NSWSC 1317 and case is about issuing a decree for a contract which is not covered under the
Act.
MAIN BODY
1. How does the Act work?
A. Legal issue within case law: payment to sub-contractors
Head contractor issue: Ghossayn Group Pty Ltd was recognised as a head contractor in
this case by Castle contractions who was other party to contract. It was started that head contract
is eligible Igor progress payment when the claim for it is accompanied by a supporting statement
as per section 13 (9) of the Act.
Service issue: Another issue related with this case was determination of the date on
which notice was received by castle construction.
The main issue in this case was related with identification of head contractor and
statements of payment to sub-contractors as they would serve as supporting document for
releasing payment from other party to whom construction services were provided1.
B. Identification of legal ideas involved in the issue, findings and Analysing Authorities:
Section 4, Head contractor: A person under construction contract is to carry out
construction work for or supply goods and services related with construction to principal (main
contract) and for that person, such work is carried out as a part or incidental to the work under
main contract (sub contract). In case principle enters into direct contract with subcontractor,
there is no head contractor.
1 Hwang, B. G., Zhu, L. and Ming, J. T.T., 2016. Factors affecting productivity in green building
construction projects: The case of Singapore. Journal of Management in Engineering. 33(3).
p.04016052.
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