Building and Construction (Security of Payment) Act 2021 (WA)

by Sophie Wallwork

New security of payment regime enacted -June 2021

The Building and Construction (Security of Payment) Act 2021 (WA) (WA Act) received assent on 25 June 2021. The Act will implement significant changes to WA’s security of payment regime to bring it more in line with other Australian jurisdictions.  The WA Act will be implemented in stages over the next 12-18 months to allow the industry to adapt to the reforms and the supporting regulations to be finalised.  Despite its staged implementation, the WA Act will apply to all construction contracts entered into in WA after the commencement date.  Contracts entered into before that date will fall under the current Construction Contracts Act 2004 (WA) (CCA).

The definitions of ‘construction work’, ‘civil work’ and ‘related goods and services’ under the WA Act are not much different to the existing definitions under the CCA and the exclusion of works in respect of resources extraction still applies, albeit much more narrowly.  

Other changes to the WA Act are aimed at increased ‘fairness’, including several key changes to the adjudication process.  The WA Act will require adjudication applications to be made within 20 business days of a payment dispute arising (rather than the previous 90 days). It will prohibit a respondent from raising new reasons in an adjudication response that were not included in the payment schedule (noting that no such prohibition exists under the current regime).  The WA Act will also introduce a statutory right to progress payments and allow for notice-based time bars to be declared unfair in particular circumstances.