Less is more: Avoiding the multiple claims issue

A recent decision has highlighted the need for clarity and certainty in submitting payment claims and the potential risk which can arise if you submit more than one invoice in respect of the same reference date and time.

It has always been the case that there can only be one valid payment claim in respect of each reference date. In the recent Queensland case of J.R. & L.M. Trackson Pty Ltd v NCP Contracting Pty Ltd & Ors [2019][1], the Court considered whether three separate invoices issued by NCP on the same project, under the same contract, bearing the same date and on the same payment terms, each endorsed under the former Building and Construction Industry Payments Act (BCIPA), constituted a single payment claim or three separate claims.

The case

The issue arose in the context of an appeal from an adjudication decision under the former Act in favour of NCP. Trackson argued that the adjudicator’s decision was void, as the claim was in fact three separate claims and under the Act there can only be one payment claim issued in respect of each reference date.

The manner in which the claims were communicated by NCP to Trackson (as separate email attachments under one covering email) was considered by the Court. The critical issue was whether, despite separate invoices each endorsed under the former Act, Trackson understood the documents received to be a single payment claim. The weight of New South Wales case authority cited by the Court strongly suggested the separate invoices were in substance a single claim.

In addition, NCP argued that the claims must be considered in the context of the history of the dealings between the two parties (prior disputes had arisen between the parties about whether some of the claims had been issued under one or multiple construction contracts in an earlier adjudication). Trackson had conceded in its submissions in the adjudication that it had received a single payment claim (albeit allegedly issued under separate contracts) and had issued a single payment schedule in response. This conduct clearly suggested that Trackson suspected it was a single payment claim. Accordingly, the Court held NCP’s claim was a single payment claim.

The lesson

The case demonstrates that issuing multiple invoices at the same time can result in disputes and could put you at risk of an allegation that only one of the invoices is a valid payment claim. That risk can easily be avoided by claiming all unpaid amounts in a single tax invoice under the Building Industry Fairness (Security of Payment) Act (under which there is no requirement for endorsement as there had been under BCIPA).

If the multiple invoices approach is adopted (issued in respect of the same project, under the same contract and bearing the same date and payment terms), it is strongly recommended the covering email or covering letter clearly identify the multiple invoices as a single payment claim, and state the total amount claimed.

[1] J.R. & L.M. Trackson Pty Ltd (CAN 088 333 381) v NCP Contracting Pty Ltd (CAN 121 915 017) & Ors [2019] QSC 201

Queries
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Disclaimer
This article is general commentary on a topical issue and does not constitute legal advice. If you are concerned about any topics covered in this article, we recommend that you seek legal advice.

The Building and Construction team has extensive experience in dealing with the regulatory regime confronting the building industry. Our presence in Brisbane, Sydney and Melbourne means that we have detailed, ‘on the ground’ knowledge of the regulatory environment in the areas where we practice, and the ‘boots on the ground’ to deal with your matter in a timely and efficient manner. If you have a regulatory issue, we have probably seen it before, and can provide you with strategic advice to assist you in achieving outstanding outcomes.

The Author

Julian Troy

PARTNER, BRISBANE

Key Contacts

Ian Heathwood

PARTNER, BRISBANE

Paul McCann

PARTNER, SYDNEY

Richard Hutchings

PARTNER, MELBOURNE