Subcontractor Payment Disputes

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Do you need a litigation expert for a subcontractor’s payment dispute?

Payment disputes almost always happen in the construction industry. So if you notice that payments are delayed, inconsistent, or not in accordance with the contract terms you’ve signed as a subcontractor on a project, you have the right to seek legal help and explore your options.

There are several causes on why subcontractor payment disputes in construction projects arise. Often, they are due to unclear or disputed contract terms, delays in payments, claims for extra work or omitted tasks, financial difficulties faced by subcontractors, and other various causes.

To prevent subcontractor payment disputes, it’s crucial for all parties involved to establish comprehensive and transparent contracts, adhere to payment schedules, maintain open lines of communication, and have a clear understanding of project expectations.

In cases where disputes do arise, that’s when you should contact Gibbs Wright Lawyer. We are litigation experts who specialise in construction disputes. We can provide legal guidance, whether you’re the subcontractor looking to sue or a higher-up in the contractual chain being sued.

We can assist you in navigating the complexities of construction payment disputes, and help you achieve a fair outcome for your situation while minimizing disruptions in your construction project.

Our Building and Construction Lawyers Can Help

We provide our building and construction legal services to developers, contractors and all kinds of subcontractors involved in construction payment disputes including:
  • Carpenters
  • Concreters
  • Electricians
  • HVAC professionals
  • Landscapers
  • Masons and stone setters
  • Painters
  • Plasterers
  • Plumbers
  • Roofers
  • Other Special Trade Contractors

How to get started

Litigation can be complex and daunting, but we’ll make the process easier for you. Book a complimentary call today.

1

Tell us your
legal matter

Speak to one of our litigation lawyers via phone for free and provide the necessary details and documents so we can better understand your situation.
2

We’ll let you know
where you stand

If we think that you have a good argument, we’ll devise a strategy for you on how we will take on your matter, and give you legal guidance and a fee estimate. All for free.
3

You Decide

It’s ultimately your decision whether to hire us or not based on the strategy and fee estimate we gave you. There’s no obligation and no pressure to proceed.
1

Tell us your legal matter

Speak to one of our litigation lawyers via phone for free and provide the necessary details and documents so we can better understand your situation.
2

We’ll let you know where you stand

If we think that you have a good argument, we’ll devise a strategy for you on how we will take on your matter, and give you legal guidance and a fee estimate. All for free.
3

You Decide

It’s ultimately your decision whether to hire us or not based on the strategy and fee estimate we gave you. There’s no obligation and no pressure to proceed.

Why Gibbs Wright

Our team of litigation lawyers are committed to protecting your rights and getting the best possible outcome for your situation.

What we do is very simple: we sue people, defend people when they get sued and negotiate resolutions to disputes to prevent proceedings from commencing. It’s the only thing we do and we do it really well.

Having done this for many years, we know the law and the legal processes like the back of our hands. But more importantly, we know how to win. No matter the industry you’re in or how complex your situation is.
When we take on your legal matter, you know that our team of expert litigation lawyers will fight for you not just for the sake of it. We will fight relentlessly so you can get back to business as soon as possible.  

Hear it from our satisfied clients

Expert litigators, ready to fight for you.

Emma Bettridge

Special Counsel

Emma is an experienced commercial litigator committed to giving her clients practical and solutions-oriented advice.

Spencer Wright

Litigation Director

Spencer leads the strategic operations at Gibbs Wright, with a wealth of knowledge on Queensland law and business operations.

Jessica Carroll

Litigation Solicitor

Jessica holds interests in defamation, corporate and contract law, and works closely with all team members of the firm to ensure the client receives the best result.

Melany Dowse

Special Counsel

Melany represents a range of clients from individuals and small businesses to body corporates and insolvency practitioners.

Mitchell Caldwell

Senior Litigation Solicitor

Mitchell has degrees in both law and aviation management and has an extensive background in customer service.

Jannah Riley

Litigation Solicitor

Jannah is the newest member of the team with keen eye for litigation and a passion for client success.

Kathryn

Manager

Frequently Asked Questions

  • What should I do if the contractor is consistently late with payments?

    You should first review your contract to understand payment terms and deadlines. If the contractor is consistently late, communicate your concerns in writing, and consider involving a legal professional to help enforce your payment rights.

  • Can I stop work if I haven't been paid?

    This depends on your contract and applicable laws. Stopping work can be a risky move and may result in further disputes or contract termination. Consult with a lawyer to explore your options.

  • What can I do if the contractor disputes the quality of my work?

    Document your work thoroughly and ensure it meets contract specifications and industry standards. Be prepared to discuss the issue with the contractor and, if necessary, seek mediation, arbitration, or legal action.

  • Are there specific laws in Queensland that protect subcontractors' payment rights?

    Yes, Queensland has legislation like the Building Industry Fairness (Security of Payment) Act 2017 (BIF Act) that regulates payment disputes in the construction industry.

  • What is a subcontractor’s charge?

    A subcontractor’s charge is a way for a subcontractor to secure monies that are owed to them under a contract by someone higher in the contractual chain.

    Essentially, it allows the subcontractor to bypass the contractor they were engaged by and instead put the principal or even the landowner of a project on notice for payment.

  • When can a subcontractor’s charge be lodged?

    A subcontractor’s charge generally only covers payment claims if certain conditions have been met. To lodge a charge, the following needs to apply:

    • your payment claim is for work done under your subcontract; and
    • money is still owed to the contractor by the person higher in the contractual chain — if the contractor has been paid in full, then a subcontractor’s charge cannot be used.
  • Who can lodge a subcontractor’s charge?

    If the above conditions have been met, then a subcontractor’s charge can be lodged by any subcontractor who has been engaged to carry out work under a building contract by a contractor. This work could be related to building or land work, such as construction, demolition, alteration, and building repair.

  • How is a subcontractor’s charge lodged?

    The first step in lodging a subcontractor’s charge is for the subcontractor to lodge a Form s122 Notice of Claim to the principal of the project and the contractor that engaged them. This form is available online here or on the QBCC website.

    The Notice of Claim form requires information such as:

    • the monetary amount of the claim;
    • details of the work that has been done or the goods that have been supplied;
    • details about the contractor; and
    • details about the project’s principal.

    If the subcontractor does not have the information readily available, they will need to ask the contractor for it in writing. The contractor must respond to the request for information within ten business days. If the contractor fails to do so, this can be reported to the Queensland Building and Construction Commission (QBCC) for investigation.

    The claim will also need to be certified by a qualified person, which under the Building Industry Fairness Act could be a registered architect, registered engineer, or a person licensed to carry out or supervise work that the claim relates to under the Queensland Building and Construction Commission Act 1991 (Qld) (the QBCC Act).

    There are strict time limits that apply when lodging subcontractors’ charges. For example — if the project work has reached the practical completion stage, then the subcontractor’s charge must be lodged within three months.

    If the Notice of Claim form is not served on both the principal and the contractor, the subcontractor’s charge will have no effect.

  • What happens after the subcontractor’s charge has been lodged?

    Once the subcontractor’s charge claim has been lodged, the contractor has ten business days to respond. The contractor responds to both the subcontractor and the person higher in the contractual chain (usually the project principal or landowner) in a response to the notice of claim form.

    They have the option to accept or dispute the claim. If the claim is disputed, the full amount may be disputed, or a partial amount may be disputed.
    If the contractor does not respond within the timeframe, they can be reported to the QBCC.

    If the contractor accepts liability for the subcontractor’s claim, the person higher in the contractual chain will pay the subcontractor the claimed amount or the amount that has been stated in the contractor’s response.

    If the contractor disputes or does not accept the subcontractor’s claim, the subcontractor can commence court proceedings to have the charge enforced.

    Court proceedings must be commenced within one month from when the notice of claim was first given.

  • What are the benefits of subcontractors’ charges?

    One of the main benefits of a subcontractor’s charge is that it protects the subcontractor — especially in the instance of a building company going into liquidation.

    If the contractor who engaged the subcontractor goes into liquidation, and the subcontractor has lodged a subcontractor’s charge claim, then the subcontractor becomes a secured creditor in the liquidation. This means that the subcontractor will be prioritised over other creditors of the company.

  • What are the downsides of subcontractors’ charges?

    A subcontractor’s charge requires adherence to strict timeframes as well as accurate information. If a subcontractor fails to provide the correct and accurate information or to adhere to the timeframes, then the subcontractor’s charge claim may be ineffective.

    It can also affect relationships in the building industry if a claim is lodged when it may not have been the best course of action and could affect the subcontractor’s ability to secure work in the future. This is not to say that you shouldn’t pursue this course of action if a subcontractor is owed money, rather, if a subcontractor finds themselves in this situation, then their best course of action is to understand where they stand legally — this is where we come in.

  • Can I negotiate payment terms in my subcontract?

    Yes, you can often negotiate payment terms before signing the subcontract. Ensure that the terms are clear and fair, and follow Queensland’s construction laws.

Explore your legal options with Gibbs Wright Litigation Lawyers - Brisbane’s Leading Litigation Firm.

Our expert litigators will let you know where you stand and give you legal guidance.