In the decision of KDV Sport Pty Ltd v Muggeridge Constructions Pty Ltd & Ors  QSC 178, the Queensland Supreme Court considered the requirement of section 17(2) of the Building and Construction Industry Payments Act 2004 (Qld) (Act) that the payment claim identifies the construction work to which it relates.
The decision involved a lump sum contract for the construction of student accommodation. The Court found that the contractor had submitted a payment claim that was not suitably detailed to identify the construction work the subject of the claim. As a result, the payment claim was invalid. Justice Brown observed that whether a payment claim is sufficiently detailed is a "relatively undemanding test". She noted the intent of the legislation to facilitate the quick resolution of payment claims. However, to achieve this purpose, the claimant is required to identify, in a reasonable way, the construction work to which the claim relates.
References in the payment claim to:
- various trade breakdowns, without further line item description of the work performed;
- completed percentage categories of work,
were insufficient to identify the construction work to which the claim related. Accordingly, the adjudicator's decision was void for jurisdictional error.
Justice Brown acknowledged that it was not incumbent upon the respondent to engage in a "process of reconstruction" based on previous claims and amounts paid. This view has been expressed in other decisions considering the requirements of a valid payment claim.
The key take away from this decision is that, when preparing a payment claim, ensure it is sufficiently detailed to allow the principal to understand the basis of the claim. This case considered the requirement of section 17(2)(a) of the Act. The Act has since been repealed and replaced by Chapter 3 of the Building Industry Fairness (Security of Payment) Act 2017. However, section 68 of the new Act retains the same requirement that the payment claim identify the construction work or related goods and services to which the progress claim relates.