The 2009 Construction Act amendments have finally given payment notices some sharp teeth after many years of neglect. Payment notices were often of no real practical effect under the 1996 Construction Act so they became rare beasts indeed.

In fact it is where there is a lack of the required payment notice in contracts governed by the Act that there is now a significantly heightened importance. This is because the Act enables the party applying for payment to submit a default payment notice (or in some cases have its application become the default payment notice) and this means that in the event that the paying party does not serve a valid pay less notice, the whole sum applied for will become payable. Whilst most employers and contract administrators are alive to this, it is worth remembering that in some contracts, like many (if not all) of the JCT forms, the requirement to issue regular payment certificates continues even after Practical Completion. Even if nothing at all has changed since the last application, such that the sum to be certified is nil, the employer still has to regularly notify the contractor of that fact.

Miss a payment notice and a pay less notice, both of which must be served promptly, and the contractor will (albeit on an interim basis) almost inevitably get every penny it applied for, whether merited or not..