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The Construction Contracts Act, also known as security of payment legislation, commenced on 1 January 2005.

Part of this legislation covers disputes between building owners and builders. The laws are designed to maintain the flow of funds between parties even when a dispute occurs and not allow an owner to retain monies owed under a contract in a bid to enforce a particular course of action by a builder.

The legislation provides for a rapid adjudication process. An application can be made within 28 days of a non-payment of a payment claim.  A response must be made to the application within 14 days and that within a further 14 days an adjudicator will determine the dispute.  The cost of this adjudication are met equally by the parties.

Rapid adjudication is another alternative for dispute settlement apart from the Building Disputes Tribunal, litigation and private arbitration. It is preferable, of course, to attempt to solve disputes by amicable arrangement without resorting to time consuming and sometimes costly formal resolution processes. However, where this is not possible these other processes should be considered by the parties.

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