Avoid A Payment Claim Pickle: Baxbex V Bickle

Rebecca Roylance
Jon Erbacher

A recent Supreme Court of Queensland decision is a timely reminder to claimants of the technical requirements that must be satisfied to successfully serve a payment claim under the Building and Construction Industry Payments Act 2004 (Qld).

As many people in the building and construction industry would be aware, one of the requirements of a payment claim is that it must identify the construction work or related goods and services claimed.

In Baxbex Pty Ltd v Bickle [2009] QSC 194, Baxbex sent an alleged payment claim under BCIPA in the form of a letter which stated:

"in accordance with s 17 of [BCIPA] we advise:-

1. the construction work and/or goods and services to which our client's progress claim relates is as particularised in the schedule hereto;
2. the amount of the progress claim that the Plaintiff claims to be payable is $148,819.10; and
3. the claim is made in accordance with [BCIPA]."

Attached to the letter was a schedule which referred to a number of invoices, but failed to attach copies of them. The schedule stated the invoice number, the date of the invoice and the balance owing. Presumably relying on the content in the invoices referred to, the schedule itself did not provide any information to identify the construction work or goods or services.

Bickle failed to provide a payment schedule and Baxbex applied for judgment of the full amount.

Payment claim

The Judge in this case found that the schedule was, on its face, not compliant with BCIPA, as it did not identify the construction work or any related goods or services. It merely invoked invoices by invoice number and amount.

Baxbex argued that because Bickle had received these invoices before, the claim sufficiently identified the work. The Judge:

1. said "the letter which was relied on as constituting the "payment claim" did not comply with s 17 of the BCIPA as neither the construction work nor related goods or services were identified within the payment claim itself"; and
2. drew a distinction between this case and another recent case where the invoices and supporting documentation were attached to the payment claim. He was of the opinion that "it would have been possible for the applicant to have sent copies of the invoices as part of, or annexed to, the schedule but this was not done."

What about administration and supervisory costs?

The judge also considered the effect of including work which was arguably not 'construction work' or 'related goods or services' in the payment claim. The payment claim included amounts for administration and supervisory costs. The Judge thought that a claimant's "entitlement to payment is dependant upon the proper construction of the contract and the legal entitlements of the parties under the contract". He also thought that "whether or not administration and supervision can be considered 'construction work' or 'supply related goods and services' pursuant to the contract is properly a matter for adjudication".

Essentially, if Bickle wanted to raise this point, it was a matter to be raised in the payment schedule, and not used later to try and defeat a judgment application.

Significance to the building and construction industry

Important points to be taken from this case for claimants include:

1. You must carefully check your payment claims to ensure they identify the construction work or related goods and services that are the subject of the claim.
2. Failing to satisfy this requirement will prevent you from successfully applying for judgment under BCIPA where no payment schedule has been received.
3. Referring to invoices and documents that identify the construction work or related goods and services is not enough. The claim itself must identify what you are claiming. This is the case even if the respondent already has these documents.

Important points to be taken from this case for respondents include:

1. If a claimant has not properly identified the work in the payment claim and you have failed to put in a payment schedule, there may still be grounds for you to oppose an application for judgment on this basis.
2. If you disagree that the work in a payment claim is not construction work or related goods or services, you should raise this in a payment schedule.

© HopgoodGanim Lawyers

Australia's Best Value Professional Services Firm - 2005 and 2006 BRW-St.George Client Choice Awards

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.