Welcome back to Construction Insights, your fortnightly resource for staying informed on the evolving landscape of construction law and industry developments. In this edition, the NSW Court of Appeal confirms that parties cannot contract out of SOPA timeframes, the NSW Supreme Court reinforces the high threshold for restraining adjudication enforcement, and Queensland proposes digital reforms to modernise its construction regulatory framework.
Case Update: SOPA deadlines are strict – deeming clauses declared void
Court of Appeal confirms parties cannot contract out of Security of Payment timeframes – Roberts Co (NSW) Pty Ltd v Sharvain Facades Pty Ltd (Administrators Appointed) [2025] NSWCA 161
In a significant decision for the construction industry, the NSW Court of Appeal has confirmed that parties cannot modify or postpone statutory timeframes under the Building and Construction Industry Security of Payment Act 1999 (NSW) (SOPA).
The Court held that a subcontract clause which delayed the deemed time of receipt for payment claims was void, resulting in a payment schedule being served out of time and judgement being entered for more than $3.27 million.
Background
Roberts Co engaged Sharvain Facades under a subcontract to carry out façade works at the Westmead Hospital paediatric services building.
The subcontract contained a ‘deeming clause’ which stated that any notice sent after 5:00pm on a business day would be deemed served at 9:00am on the following business day.
On 28 February 2025 at 7:18pm, Sharvain issued a payment claim for $3,207,999.03 via the Payapps platform to Roberts’ nominated email address. Relying on the deeming clause, Roberts treated the claim as served on 3 March 2025 and issued its payment schedule on 17 March 2025 – 10 business days from that date.
Sharvain contended that the claim was served on 28 February 2025, making the schedule late and invalid. It sought judgment under ss 14(4) and 15(2) of the SOPA.
Key issue
Whether a contractual deeming provision could lawfully postpone the statutory date of service of a payment claim – thereby extending the time available for the respondent to serve a payment schedule.
Court of Appeal decision
The Court unanimously dismissed the appeal, finding that the payment claim was served on 28 February 2025 and that the payment schedule was served out of time.
Key findings:
- Time of service (SOPA, s 31): The payment claim was capable of being retrieved from Roberts’ nominated email inbox on 28 February 2025, and was therefore validly served that day. The fact that it was sent after 5:00pm was irrelevant – “the law does not recognise fractions of a day”.
- Effect of the deeming clause: Although parties may contract to shorten the 10 business day period under section 14(4), they cannot extend it. In delaying the deemed date of receipt, the deeming clause effectively gave Roberts more time – contrary to the purpose of the Act.
- No contracting out (SOPA, s 34): Section 34 invalidates any contractual term purporting to displace or modify the operation of the Act. The deeming clause, insofar as it postponed the start of the response period, was void.
- Electronic Transactions Act 2000 (NSW): The Court acknowledged that the deeming clause was an “otherwise agreed” arrangement under s 13A(1) of the ETA. However, that Act cannot override the mandatory service and response periods prescribed by the SOPA.
Outcome
Because the payment schedule was served after the 10 business day window, it was invalid. Roberts was liable for the full claimed amount and Sharvain was awarded judgement for $3,278,043.27 (including interest).
Takeaway
- Statutory deadlines are strict and cannot be extended – under s14(4) the 10-business-day response period begins from actual service, not a contractually deemed date.
- Contractual deeming provisions are unenforceable if they conflict with SOPA – s 34 ensures that any attempt to delay or alter timeframes will be void.
- Service occurs when the document is capable of being retrieved – including after business hours if sent electronically.
- Contracts must be SOPA compliant – construction contracts should not include clauses that delay or override SOPA timelines.
Practical implications
This case sends a clear message to contractors and principals: do not rely on after-hours deeming clauses or other contract terms that are inconsistent with SOPA timeframes.
Careful attention must be paid to actual service dates, and payment schedules must be issued promptly to avoid liability for the full claimed amount.
Read the full judgement here: PDF – Roberts Co (NSW) Pty Ltd v Sharvain Facades Pty Ltd (Administrators Appointed) [2025] NSWCA 161 | NSW COURT OF APPEAL
Case Update: Risk of insolvency, a high bar to warrant an injunction
New South Wales Supreme Court confirms high bar for restraining adjudication enforcement – DECC Credit Pty Ltd v Australia Wide Lining Pty Ltd [2025] NSWSC 826
The NSW Supreme Court has reaffirmed the strict approach to interlocutory injunctions that would restrain enforcement of adjudication certificates under the SOPA. In DECC Credit Pty Ltd v Australia Wide Lining Pty Ltd [2025] NSWSC 826, the Court declined to continue an injunction restraining enforcement of an adjudication determination, finding that alleged adjudication errors and limited evidence of insolvency risk were insufficient to overcome SOPA’s “pay now, argue later” policy.
Background
On 4 July 2025, an adjudicator awarded $1,576,129.06 to the subcontractor, Australia Wide Lining Pty Ltd (AWL), following a payment claim served under SOPA. The contractor, DECC Credit Pty Ltd (DECC), sought an interlocutory injunction on 18 July 2025, restraining AWL from filing or enforcing an adjudication certificate under ss 24 and 25 of SOPA. As a condition of the injunction DECC paid $1,733,741.97 into Court.
On 22 July 2025, the matter returned for hearing. DECC argued that the injunction should be maintained due to alleged jurisdictional errors in the adjudication determination and a risk that any payment to AWL would irrecoverable due to its alleged financial instability.
Court’s decision
Justice Peden lifted the injunction, finding that DECC had not discharged the heavy burden required to restrain enforcement of an adjudication certificate. However, a partial stay was granted in relation to a recognised “over-award”.
Key findings:
- Over-award accepted but not jurisdictional: The adjudicator awarded more than AWL claimed in its adjudication application – $1,576,129.06, compared to $1,267,425.16 – by erroneously relying on the original payment claim. AWL accepted that this gave rise to a serious question to be tried and agreed to a stay on the over-awarded sum of $339,580.89. However, this error was not considered jurisdictional and did not affect the validity of the entire determination.
- No cogent evidence of insolvency risk: DECC argued that AWL’s financial position made it risky to release the adjudicated sum. The Court rejected this, noting that:
- DECC relied only on an ASIC search and statements about AWL’s cash flow from the adjudication.
- AWL tendered an up-to-date balance sheet showing net assets of $2.63 million, up from $1.68 million the previous year.
- There was no expert evidence of actual or imminent insolvency.
- SOPA policy overrides speculative risks, with the Court emphasising the “pay now, argue later” nature of the regime. Interlocutory relief should only be granted where there is clear, substantial evidence of insolvency or jurisdictional error. This was not such a case.
Outcome
The injunction was lifted to the extend of $1,394,161.08, which was ordered to be paid out of Court to AWL. The remaining $339,580.89, representing the adjudicator’s over-award, remained subject to a stay pending DECC’s judicial review proceedings.
Takeaway:
- Heavy burden for injunctions: A party seeking to restrain enforcement of an adjudication certificate faces a high threshold, especially where the payment has been secured by payment into Court.
- Evidence of insolvency must be robust: Courts require clear, expert financial evidence—not speculation, general assertions, or ASIC searches—to establish a real risk of insolvency.
- Partial stays may be available: Errors in an adjudicator’s determination (e.g. over-awards) may justify partial relief but will not invalidate the determination unless jurisdictional in nature.
- SOPA policy remains paramount: The decision underscores the judiciary’s firm adherence to the SOPA’s policy of ensuring prompt cash flow to subcontractors, even where the paying party alleges errors or financial risks.
Read the full judgement here: DECC Credit Pty Ltd v Australia Wide Lining Pty Ltd [2025] NSWSC 826 | SUPREME COURT OF NEW SOUTH WALES
Case Update: Victorian Supreme Court quashes adjudication over premature payment claim and late notice
Victoria Supreme Court reiterates strict compliance with procedural requirements is paramount – Domi Construction Pty Ltd v CNS Linings Pty Ltd [2025] VSC 459
The Supreme Court of Victoria has reinforced the need for strict compliance with procedural requirements under the Building and Construction Industry Security of Payment Act 2002 (Vic) (the Act). In Domi Construction Pty Ltd v CNS Linings Pty Ltd [2025] VSC 459, the Court set aside a $45,349.92 adjudication determination, finding multiple jurisdictional errors arising from non-compliance with the Act’s timing and service provisions.
Background
Domi Construction Pty Ltd (Domi) engaged CNS Linings Pty Ltd (CNS) to perform plastering works under a subcontract. On 19 June 2024, CNS served a spreadsheet (the “19 June Spreadsheet”) which it treated as a final payment claim under the Act.
On 5 August 2024, CNS served an adjudication notice under s 18(2). The adjudicator issued a determination on 5 September 2024 awarding $45,349.92 incl. GST to CNS.
Domi sought judicial review, arguing the adjudication determination was void due to several jurisdictional defects, including:
- Invalidity of the payment claim
- Premature service of the final claim
- Late adjudication notice
- Consideration of excluded amounts
- Procedural unfairness in the adjudication fee apportionment.
Court’s findings
Justice Tsalamandris upheld the challenge on two key grounds, finding jurisdictional errors that invalidated the determination.
- Payment claim served prematurely (s 14(5)): Although the 19 June Spreadsheet was sufficiently specific and identified the claimed work and amount, it was found to be a final payment claim served before:
(a) The expiry of the defects liability period, or
(b) The elapsing of three months from the reference date, as required by s 14(5). This rendered the payment claim invalid, constituting a jurisdictional error.
- Late adjudication notice (s 18(2)(a)): CNS served its adjudication notice on 5 August 2024, but the payment due date under s 12(1)(b) was 3 July 2024. The deadline for serving the s 18(2) notice was therefore 17 July 2024. The notice was served out of time, resulting in a second jurisdictional error.
- Other issues rejected:
(a) Excluded amounts (s 23(2A)) – The adjudicator did not rely on non-claimable variations; no jurisdictional error arose.
(b) Procedural fairness – No denial of natural justice occurred in relation to adjudication fees. Both parties had opportunity to respond.
Outcome
The Court quashed the adjudication determination dated 5 September 2024. CNS was not entitled to the adjudicated amount due to the invalidity of the payment claim and late adjudication notice.
Takeaway
- Final payment claims must strictly comply with s 14(5): They cannot be made before the defects liability period expires or within three months of the relevant reference date.
- Deadlines for adjudication notices are rigid: The 10-business-day window under s 18(2)(a) starts on the date the payment becomes due under s 12(1)(b)—not from when it suits the claimant.
- Sufficiency of a payment claim is judged objectively: A claim need not be hyper-technical—so long as it is clear to a party familiar with the project.
- Minor errors do not always invalidate determinations: Issues such as excluded amounts or adjudication fees will only amount to jurisdictional error where there is clear non-compliance or unfairness.
Practical implications
This decision is a reminder to closely track timing provisions under the Security of Payment regime—particularly for final claims. Contractors and subcontractors should diarise reference dates and DLP expiry, ensure adjudication notices are served within the statutory timeframe, and review payment claims for compliance with s 14.
Read the full judgement here: Domi Construction Pty Ltd v CNS Linings Pty Ltd [2025] VSC 459 | SUPREME COURT OF VICTORIA
Case Update: Court confirms: agreed scope cannot be clawed back as variation under SOPA
Victoria Supreme Court confirms that contractually agreed scope of works cannot be reframed as a variation – Little Hardiman Street Pty Ltd v Henny Pty Ltd [2025] VSC 436
The Supreme Court of Victoria has confirmed that contractually agreed scope of work cannot be reframed as a variation or set-off in an adjudication. In Little Hardiman Street Pty Ltd v Henny Pty Ltd [2025] VSC 436, the Court upheld an adjudicator’s decision to reject a $752,624.57 deduction claimed by the principal, finding that the works in question were squarely within the agreed scope and could not be recharacterised as a variation.
Background
Little Hardiman Street Pty Ltd engaged Henny Pty Ltd under an amended AS4902-2000 Design & Construct Contract to deliver a $25 million apartment development in Kensington, Victoria.
- On 26 September 2024, Henny submitted progress claim 27 for $380,149.32.
- The Superintendent responded by certifying negative $752,624.57, asserting that Henny owed the principal for “value management” savings through alternative materials (the VMA Work).
- On 3 October, the Superintendent issued a payment schedule deducting the VMA amount and claiming $479,594.86 was owed by Henny to Little Hardiman.
- Henny sought adjudication. On 1 November, the adjudicator awarded $386,231.26 in Henny’s favour—rejecting the VMA deductions.
Little Hardiman applied to quash the determination, arguing that the VMA Work was a variation within the meaning of s 10A(3) of the Building and Construction Industry Security of Payment Act 2002 (Vic) (the Act).
Key issue
Whether the VMA Work:
- Formed part of the original contract scope, or
- Constituted a variation under s 10A(3) of the Act (which permits certain deductions for omitted scope or cost savings).
Court’s findings
Justice Stynes upheld the adjudicator’s reasoning, confirming that:
- The VMA Work was within the agreed scope, as it was expressly covered in Part F of the contract annexure, which formed part of the contractual documents and carried high interpretive weight under the Contract’s hierarchy (per cl 2.1 of the Formal Instrument).
- The principal’s reliance on various provisions was misplaced, including:
- Clause 29.3, which only applies to non-conforming work—but the VMA Work did comply with the Contract.
- Clause 29.4, which deals with defective work accepted as a variation—again irrelevant.
- Item 126, which refers to value management options proposed by the contractor and agreed by the principal—whereas the VMA Work had already been agreed in the scope at contract formation.
- The Act’s definition of “variation” under s 10A(3) requires a change to the scope of work — whereas here, the work had always been part of the agreed scope.
Accordingly, the Court held that the $752,624.57 VMA deduction had no contractual foundation, and there was no jurisdictional error in the adjudicator’s decision.
Outcome
The Supreme Court upheld the adjudication determination. Little Hardiman was liable to pay $386,231.26 to Henny.
Takeaway:
- Defined scope is king – If work is clearly included in the contract documents (especially Part F or detailed annexures), it cannot later be recast as a variation or deduction.
- Variations must reflect actual changes – For a deduction or adjustment to qualify under s 10A(3), the scope must have been contractually altered—not merely clarified.
- Adjudicators can reject “value management” set-offs where they lack a clear contractual basis or contradict agreed scope.
- Principals must carefully review scope alignment before issuing deductions—particularly under progress claims where adjudication may follow.
Read the full judgement here: Little Hardiman Street Pty Ltd v Henny Pty Ltd | SUPREME COURT OF VICTORIA
Proposed reforms to modernise the Queensland Building and Construction Commission Act 1991 and safety notification framework
Queensland is set to modernise its building regulation landscape, with proposed amendments to the QBCC Act, Building Act 1975 , and Plumbing and Drainage Act 2017. These reforms aim to bring Queensland closer in line with other jurisdictions by streamlining processes, enhancing digital service delivery, and improving safety-related information sharing.
Objectives
The amendments seek to:
- Establish a contemporary and streamlined regulatory framework for the QBCC;
- Enable the QBCC to deliver more services digitally, improving customer experience and operational efficiency;
- Simplify safety notification processes to reduce duplication and improve productivity across the building and construction industry.
What’s changing?
The amendments will impact all three Acts, with key proposals including:
- Digital-first approach to licensing: Removal of the requirement for QBCC licences to be issued as physical hard copy cards.
- Electronic service of documents: Introduction of a statutory pathway to allow documents to be served digitally.
- Streamlined safety notifications: QBCC licensees will no longer need to notify the QBCC of a safety incident if it has already been reported to the regulator under the Work Health and Safety Act 2011 (WHS Act) or Electrical Safety Act 2002 (ES Act).
- Improved inter-agency communication: Changes to allow the WHS and Electrical Safety regulators to share relevant safety information with the QBCC regarding serious incidents on construction sites. Ensure a contemporary modernised regulatory framework for the QBCC;
The parliamentary committee is expected to report back on the proposed amendments by Friday, 15 August 2025.
We will provide further updates once the committee’s recommendations are released and any legislative changes are finalised.
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