In 2018, the Queensland Government enacted the Plumbing and drainage act that would repeal the 2002 Act.
What is the new Plumbing and Drainage Legislation?
The Queensland legislature decided to repeal the former ‘Plumbing and Drainage Act 2002’ and replaced it with the ‘Plumbing and Drainage Act of 2018’ (PD Act). As a result of this change, the ‘Plumbing & Drainage Regulation of 2019 (PDR)’ replaced the ‘Standard Plumbing & Drainage Regulation 2003’.
The PD Act has revamped the industry by focusing on safety and efficiency. Undoubtedly, the Plumbing and Drainage Act 2019 seeks conformity with modern demands and conformity with National and state codes of the building industry. In addition, the PD Act sanctions individuals, that operate illegally and contravene certain provisions, more severally. These changes in laws came after concerns raised by interested parties that the former Act was enigmatic and inadequate in making the functioning of the industry easier and efficient. Perhaps this was brought by the former legislations causing confusions through vague, repetitive and unnecessary provisions. Nevertheless, representatives from relevant government agencies and other interested parties participated in a review of the outdated legislation and assisted in finding solutions to shape the new laws in Queensland, as the responses received was internalised and processed by the Department of Housing and Public Works.
What are the relevant changes to the plumbing and drainage act?
Although the Plumbing and Drainage Act 2019, preserves the majority of the provisions from the former legislation, it will transform the industry by:
• Imposing severe penalties on individuals that conduct works without a valid licence. Penalties may include a period of imprisonment;
• Improving the readability of the Act as a whole to ensure simpler interpretations of the provisions;
• Improving the readability of the Act by removing duplicated provisions;
• Establishing simpler procedures and processes to administer and manage permits;
• formulating guidelines for interested parties that is in line with National codes;
• improving and maintaining the health and safety of the public community that is involved in plumbing and drainage services;
• creating an Act that is intelligible by removing irrelevant terminology and substituting them with suitable modern terms;
• And changes time frames to ensure the efficiency.
What is the effect and purpose of the new Regulations?
The regulations objective is to assist the Plumbing and Drainage Act become transparent and simpler for relevant parties to interpret and understand. Subsequently, the regulations assist the enactment and implementation of the PD Act by:
• Approving a working framework that is in line with national plumbing and drainage codes; and
• Approving a standard that is inclusive of Queensland codes and standards; and
• Assisting transition between the former provisions and former regulation to the new ‘PD Act’; and
• To assist authorising bodies, administer certifications efficiently by changing the required timeframes; and
• Acknowledging and managing the expected consequences for the industry, local government and other interested parties.
What are other notable reforms to the legislation in the trade industry?
The trade has further minor changes in the industry that brings Individuals with contractor, nominee supervisor or site supervisor licence types cleared from paying ‘Plumbing and Drainage Occupational fees’ for renewals and new applications. In a situation where the individuals do not hold any of the above-mentioned licences, but are in the possession of Plumbing and Drainage licences only, or individuals in possession of ‘Plumbing and Drainage Licences’ that extend to associated QBCC Licences, the individual would unfortunately miss the payment waiver and be required to pay fees.
What this means for you?
The new Act will ensure efficiency and incorporate the National Codes to ensure consistency throughout the trade industry. This shall serve the Industry with cost effective functioning and bolster the industry as it becomes easier and transparent for the interested parties of the industry. Subsequently, the Act attempts to make businesses simpler with very little prejudice and frustration. In addition to the above, the Act shall improve the readability for interested parties, and assist the industry in assessing and meeting their responsibilities with great accountability and understanding.
How can we help?
If you want to know how the implications of the New Plumbing and Drainage Act will affect your business, whatever the size or scale, please contact the team at Rostron Carlyle Rojas Lawyers on (07) 3009 8444 or email us at firstname.lastname@example.org.
Please note that this article has been prepared by Takudzwa Makusha, Law Clerk and settled by John Christian, Associate of Rostron Carlyle Rojas Lawyers. Its contents are for general information purposes only and does not by any means constitute legal advice, nor should it be relied upon.
Do you conduct Building work in Queensland and New South Wales? The interstate consequences when ventures from down South, go South…
The Implications of the QBCC Act on construction projects is broader than you might think
In light of the recent decision in Vickers v Queensland Building and Construction Commission & Ors , the insolvency of a related building company operating in New South Wales can also lead to the cancellation of a Queensland company’s builder’s licence by the Queensland Building and Construction Commission (QBCC). This short article will discuss how the liquidation of an interstate entity conducting building works in New South Wales was considered to be a “construction company” under section 56AC of the Queensland Building and Construction Commission Act 1991 (Qld) (QBCC Act). As a result, the director of the related entity has had his Queensland builders licence cancelled.
Michael Anthony Vickers (Vickers) was the director of two construction companies, Midson Construction (NSW) Pty Ltd (Midson NSW) and Midson Construction (Qld) Pty Ltd (Midson QLD). After Midson NSW was placed into liquidation on 3 January 2018, the QBCC proposed cancellation of Vickers’s building licence. Vickers appealed to the Queensland Court of Appeal, sought declaratory and injunctive relief and judicial review of the QBCC’s Notice of Reasons for cancellation of his builders licence in Queensland.
On appeal, the court considered the following issues:
1. Whether a New South Wales construction company was a “construction company” within the meaning of the QBCC Act; and
2. Whether section 56AC of the QBCC Act was constitutionally valid?
Was Midson NSW a “construction company” according to the QBCC?
Vickers attempted to argue that the definition of a “construction company” pursuant to section 56AC of the QBCC Act could not be extended to a construction company operating in New South Wales. Vickers argued that the definition of a construction company should be restricted to a company that undertakes building works or services on buildings in Queensland, being consistent with the scheme of the QBCC Act.
Construction failure outside of Queensland can result in the cancellation of your licence in Queensland
The Court of Appeal held that failure outside of Queensland can trigger the suspension or cancellation of a builder’s licence to operate in Queensland. The QBCC Act is not limited to the operation of a company conducting “building work or building work services” in Queensland. Even though events of insolvency occur outside of Queensland, the Court stated that it was self-evident that the QBCC Act aims to prevent the risk to Queensland consumers arising from building companies becoming insolvent.
A Queensland building licence holder or builder who is associated with a company which has failed to remain solvent within a different jurisdiction is considered to be no different than a licensee becoming insolvent within Queensland. To conclude, where a company has been liquidated, the Court held that section 56AC of the QBCC Act applies irrespective of which state in Australia the construction company undertakes building work and building work services.
Was section 56AC of the QBCC Act constitutionally valid?
Vickers also argued that the words “in this or another State” in section 56AC of the QBCC Act was too remote from the “peace, welfare and good government” of Queensland, and therefore the provision was constitutionally invalid – the Court disagreed. The Court considered that section 56AC of the QBCC Act does not regulate conduct in another State, but rather recognises the consequences within Queensland for actions or failed construction ventures within another State. Consequences being, a company or person who holds a building licence in Queensland may have it suspended or cancelled.
In essence, the QBCC Act aims to protect Queensland consumers by ensuring that a building licence is cancelled should a building company (or associated entity) have insufficient financial stability. The QBCC also requires licensees of building licences to be a fit and proper person, which may reflect the financial stability of a building company or associated entity.
How can we help as your construction lawyers?
If you are completing building works in both Queensland and New South Wales using different entities, or thinking of expanding your business operations into the southern State, please contact the team at Rostron Carlyle Rojas Lawyers on (07) 3009 8444 or email us at email@example.com.
Please note that this article has been prepared by Jakob Mignone, Law Clerk and settled by John Christian, Associate of Rostron Carlyle Rojas Lawyers. Its contents are for general information purposes only and does not by any means constitute legal advice, nor should it be relied upon.
If you have been the victim of defective or incomplete domestic building work then you may be eligible to claim from the QBCC insurance scheme to allow rectification of the defects and completion of the works.
Queensland Building and Construction Commission (QBCC) administers a compulsory domestic building insurance scheme- the QBCC Insurance Scheme. When you sign a building contract for the construction or additions to a domestic building, the insurance is paid by the builder.
When is QBCC Insurance Required (or Applicable)?
The insurance scheme applies where there is defective building work or where the contract with the builder has been lawfully terminated or the building company has become insolvent (liquidated or bankrupt).
Once a claim has been made to the Queensland Building and Construction Commission, an inspector will assess the defective or incomplete work and issue a notice to the builder to rectify or complete the work within (usually) 14 days. If the original builder refuses or is unable to rectify the work, the QBCC will ask you to obtain quotations from other contractors.
Assuming these are in order, the QBCC will approve and insurance payment for the lowest quotation and then you may choose any contractor to rectify the problems. (You might be interested in viewing the qbcc insurance table 2018, link to pdf supplied below)
Insurance is usually available for minor defects up to 6 months from the date of practical completion and for structural or major defects up to 6 years.
The Early Dispute Resolution also offers mediation services and may be able to assist you with general inquiries with respect to builders prior to commencement of building works.
Prior to entering into a contract with a builder, we recommend that you make inquiries of your builder’s qualifications, seek references from past clients and consult with your solicitor.
If you would like any information on the QBCC or your entitlement to claim under the Insurance scheme, contact us today.
For more information you can contact Queens Building and Construction Commission. Contact Number: 139 333 business hours: 7am – 5pm, Monday to Friday, Overseas callers: +61 7 3447 2160. Or email them, Email
In this construction law blog, Paul Rojas discusses a recent case where the validity of a charge issued pursuant to the Subcontractors’ Charges Act 1974 (Qld) (“the SCA”) was considered.
Our client issued tax invoices in respect of its work. Unfortunately, the builder soon entered into Administration so our client issued a subcontractors’ charge pursuant to the SCA for the unpaid tax invoices to the developer. Several other subcontractors also lodged charges. The developer paid the funds into Court and the builder proceeded to issue a notice under the SCA certifying the full amount claimed by our client as owing.
Several of the parties commenced proceedings to secure their charges within the one-month time limit. Our client did not. These parties then successfully applied to have the proceedings combined and the funds paid out of Court. The Court retained an amount for our client’s claim.
Our client proceeded to obtain legal advice that his subcontractors’ charge had expired because he had not commenced proceedings within one month after the charge had been served.
We were subsequently engaged by our client to recover the funds paid into Court.
We were required to consider whether our client’s failure to commence proceedings within one month after service of the charge had caused the charge to become invalid.
Our client was fortunate in that the period the builder was in Administration stopped the one-month period from running. This period restarted once the builder entered into a deed of company arrangement.
During the period of the Builder’s Administration, several other subcontractors had also commenced proceedings to enforce their charges under the SCA. The effect of this was that:
- those proceedings were brought on behalf of every other subcontractor who had issued a charge under the SCA; and
- where the one-month period our client had to commence proceedings had not expired, our client was entitled to “piggy-back” onto those charges by joining the proceedings commenced by the other subcontractors.
However, our client was not able to simply commence fresh proceedings and apply to have them joined. It needed to identify which proceedings had been commenced within the one-month period and seek to be joined to them as a Plaintiff. Fortunately, those proceedings were the proceedings in which the developer had paid money into Court.
Rostron Carlyle Rojas Lawyer, Madison Lodder, appeared and successfully obtained orders for payment of our client’s charge.
The above illustrates the importance of engaging lawyers who understand the complexities of construction law and the operation of the SCA.
The RCR Construction team are able to assist in providing advice and strategies for recovery of claims made pursuant to the SCA. Contact our Construction team, please call us on (07) 3009 8444 or email us at firstname.lastname@example.org.
The above information is intended only as general information and should not be interpreted or relied upon for legal advice.
In the decision of 470 St Kilda Road Pty Ltd v Robinson  FCA 597, the Federal Court of Australia found that a Chief Operating Officer of a building and construction company was personally liable for falsely declaring in a statutory declaration that all subcontractors had been paid.
In October 2010, 470 St Kilda Road Pty Ltd (“the Principal”) engaged Reed Constructions Pty Ltd (“the Builder”) for the redevelopment of an office building at 470 St Kilda Road, Melbourne (“the Contract”). The Contract required the Builder to provide a statutory declaration prior to delivering a payment claim which affirmed all monies owing to subcontractors and suppliers had been paid.
Mr Glenn Robinson (“Mr Robinson”), as the Chief Operating Officer of the Builder, sent to the Principal a statutory declaration (“the Declaration”) confirming all subcontractors and suppliers have been paid in full. The Builder then submitted a payment claim seeking payment.
The Principal relied upon the Declaration and made payment $1,426,641.70 to the Builder.
The Declaration was later discovered to be false after the Builder entered into liquidation owing $132 million to unsecured creditors.
Mr Robinson argued that the Declaration was merely a statement of his mind and one as to the enquires that had been made to inform that state of mind.
The Court held that the Declaration of Mr Robinson was not merely a statement of his state of mind, but rather a solemn promise acknowledging that the contents are true and correct, which, if falsified, amounts to perjury.
Mr Robinson was held to have engaged in misleading and deceptive conduct as he knew the Declaration was untrue and had the Principal known the true position of the Builder, it would not have made payment of the payment claim.
The Court held Mr Robinson personally liable to pay the Principal the sum of $1,426,641.70, being the total of the claim previously submitted by the Builder to the Principal.
The requirement for statutory declarations certifying payment of all outstanding subcontractors and suppliers is commonplace in the construction industry. The practical effect of the decision highlights the importance of ensuring that all reasonable steps are taken to warrant the truth of the statutory declarations at the time it is signed. It also highlights the consequences of failing to take these steps or for signing an untrue statutory declaration.
Additionally, directors need to be aware of the possible implications of this conduct on director’s liability insurance which may limit or void the director’s coverage.
The RCR Construction team are market leaders in construction litigation and dispute resolution. Contact us or visit our dedicated Construction website for more information on your rights and obligations.
The above information is intended only as general information and should not be interpreted or relied upon for legal advice.
In late 2017, the Queensland Government enacted the Building Industry Fairness (Security of Payment) Act 2017 (“the BIF Act”). The BIF Act brings significant changes to the security of payment regime for the Queensland building and construction industry.
Building Industry Fairness (Security of Payment) Act 2017 – Major changes for the Queensland building and construction sector are here
On 10 November 2017, the Building Industry Fairness (Security of Payment) Act 2017 received royal assent.
Although the key provisions of the Act do not come into force until a date to be proclaimed by the Queensland Government, it is anticipated that the major reform to the operations of the Queensland building and construction industry will take effect from early 2018.
The controversial changes were enacted following a six-months consultation with the industry stakeholders and an intensive advertising campaign focusing primarily on the project bank accounts as a mechanism for a ‘fair’ recovery of payments for the tradie subcontractors. 1
The Act consolidates the current Queensland security of payment legislation2 and introduces some important amendments to the Queensland Building and Construction Commission Act 1991, particularly in relation to tougher measures in prosecuting unlicensed building work and targeting insolvency in the building industry. We will be discussing the changes to the QBCC Act in a separate publication, so watch this space.
Project Bank Accounts
The mandatory use of project bank accounts will be gradually phased in over the next two years. From the early 2018, all Queensland Government construction projects of the value between $1 million and $10 million will be covered by the operation of the Act. From 1 January 2019, all of the construction projects above $1 million including the private, 3 commercial and government sector will be required to operate the compulsory project bank accounts. Separate contracts for building work at the adjacent sites for a combined value of over $1 million between the same parties will be taken to be a single contract and thus also covered by the project bank account requirements.
Although a large body of the procedural matters will be addressed by a regulation, which is yet to be drafted, we have summarised the most important provisions with respect to the project bank accounts below.
Despite the flavour of the earlier advertising campaign and the Government’s various press releases, 4 only the head contractors and tier one subcontractors 5 will be covered by the new security of payment regime through the operation of project bank accounts, leaving the end suppliers and subsequent subcontractors out.6 However, these categories of the building industry operators will still be able to recover payments from their employers through the usual channels, like the payment claims and subcontractors’ charges.
Each of the project bank accounts will be utilised to hold on trust only the following amounts:
- payments by the principal to the head contractor under the building contract;
- payments to a subcontractor from the head contractor under the first-tier subcontract;
- retention monies withheld under the first-tier subcontract; and
- monies the subject of a payment dispute.
This system will necessitate the operation of three separate trust accounts7 for each project, with the head contractor being the trustee and beneficiary of these accounts, while each of the first-tier subcontractors are to have a beneficial interest in the amounts held on trust. The accounts must be operated by a financial institution within Queensland and be generally opened within 20 business days after the head contractor enters into a first-tier subcontract.
There are strict requirements for the operation of the project bank accounts, in particular, deposits and withdrawals only by electronic transfer, withdrawals and transfers between the accounts only by using a payment instruction given to the financial institution.
The head contractor will not be entitled to pay itself unless sufficient funds are held in the trust account to cover payments due to the subcontractors and must cover any short fall in the trust funds, which is unpaid by the principal. If there are insufficient funds in the account the head contractor must pay all of the subcontractors to whom payments are due on a pro rata basis.
There is an express exclusion of the trust account funds from the creditor claims (other than the subcontractor beneficiaries), as well as a prohibition on investment of these funds other than interest earned on each of the accounts. The head contractor is unable to recover the costs of the administration including the bank fees from the funds held in the project bank accounts or from the subcontractor beneficiaries.
The Act establishes a new process for progress payments and associated dispute resolution, which is largely based on the modified provisions of the Building and Construction Industry Payments Act 2004. As opposed to the project bank account provisions, this process is applicable to all suppliers and subcontractors who contribute to a construction contract and the definitions of construction work and the related goods and services for the purposes of the payment claims are very wide.
The new procedure for submission of the payment claims is somewhat more favourable towards the claimants (similar to the old regime prior to the 2014 amendments).
The requirements for the payment claim remain unchanged, although there is currently no express prerequisite for stating that a payment claim is made under the Act (similar to the security of payment legislation in NSW). However, further requirements as to the form and content may be enacted under a regulation for both the payment claim and the payment schedule.
An additional final reference date is added for terminated contracts.
If the construction contract does not provide for a due date of a progress payment, the due date will become the 10 th business day from the date a payment claim is made.
A payment claim must generally be given within 6 months of the carrying out the work or the supply of the related goods and services, unless provided for otherwise in a construction contract. Although only one payment claim is to be made for each reference date, any amounts from previous payment claims may be included in the subsequent claims.
The payment schedule must be provided by no later than 25 business days after the day the payment claim is given or earlier if the shorter period is specified under the relevant construction contract. If the respondent fails to give the payment schedule, as prescribed, the amount in the payment claim becomes payable by the due date for the relevant progress payment, which means that if the contract is silent as to the due date, the respondent is immediately liable for the full amount of the payment claim.
Penalties, as well as disciplinary action under the QBCC Act, now apply for a failure to provide a payment schedule in response to a payment claim.
Dispute Resolution Process
If the respondent does not issue a payment schedule and fails to pay the amount of the payment claim, the claimant may elect to recover the claim as a debt through court action or to apply for adjudication.
There is a further entitlement for the claimant to suspend work with notice upon the conditions specified in the Act.
The claimant may apply for adjudication within the following time frames:
- for a failure to deliver the payment schedule: 30 business days after the later of the due date for the relevant progress claim or the last day when the respondent could give the payment schedule.
- for a failure to pay the amount stated in the payment schedule: 20 business days after the due date for the relevant progress payment; and
- for a dispute with respect to the amount stated in the payment schedule: 30 business days after the claimant receives the payment schedule.
The respondent will be unable to submit an adjudication response if no payment schedule was given with respect to the payment claim. Any adjudication response also may not include any new reasons, which were not included in the payment schedule.
The adjudication response must be given to the adjudicator within the following time frames (‘response date’):
- for a standard claim within the later of 10 business days after receiving a copy of the adjudication application or 7 business days after receiving adjudicator’s notice that the adjudication application was accepted.
- for a complex claim (over $750,000 excl GST) 15 business days after receiving a copy of the adjudication application or 12 business days after receiving adjudicator’s notice that the adjudication application was accepted. These timeframes may be further extended at the discretion of the adjudicator for up to 15 additional business days upon application (which must be made within a specified time limit).
After the adjudication response date (which will apply as specified above regardless of whether the respondent is entitled to give the adjudication response), the adjudication decision must be made within 10 business days for a standard claim and 15 business days for a complex claim respectively.
As an alternative to the adjudication process, the claimant may give a 5 business days’ warning notice to the respondent of the intention to commence court proceedings to recover the payment claim. Such notice must be given within 20 business days from the due date of the relevant progress payment. The claimant will then be able to apply for judgment provided that the court can be satisfied that the progress payment was not paid by the due date and that the payment schedule was not given (if applicable). The respondent will be unable to bring as counterclaim or any defence with respect to the matters arising out of the relevant construction contract in those proceedings (similar to the old regime prior to the 2014 amendments).
The provisions of the Subcontractors’ Charges Act 1974 appear to have been adopted with little change. The most notable variation however is the inclusion of the mandatory response period to a claim of charge within 10 business days of service of the claim. Further, a charge under Chapter 4 of the Act will not attach to the funds held in the project bank accounts, which means that from early 2018 the subcontractor’s charges are likely to be only effectively utilised by the subcontractors below the first tier under a building contract. If the claim of charge is issued, the claimant will be unable to enforce a progress claim or to initiate proceedings under Chapter 3 of the Act unless the claim of charge is withdrawn.
The Act provides the QBCC with an active role as a watchdog for compliance including, for example, audit of the project bank accounts, registration and administration of the adjudicators and processing of the various hefty fines and penalties under the Act. Strict compliance is anticipated to be enforced, given that imprisonment terms apply to the offences against several provisions of the Act. However, it is yet to be clarified by regulation as to due processes for imposing those penalties.
Curiously, the Act contains a provision for a compulsory review of the reform by the minister to be commenced no later than 1 September 2018, which indicates that the new law is in a live test mode for now.
These changes will affect every stakeholder in the building and construction industry in Queensland. The above information is intended only as a selective overview of the provisions of the Act and should not be interpreted or relied upon for legal advice.
For further information please contact our construction lawyers on (07) 3009 8444.
1 For example, TV commercial from Queensland Department of Housing and Public Works published on Youtube on 1 February 2017.
2 Repeal of the Building and Construction Industry Payments Act 2004 and the Subcontractors’ Charges Act 1974.
3 The contract for construction of three or less residential dwellings and associated structures is currently excluded from this requirement.
4 For example, Premier’s and Minister’s statement on 30 November 2016 published by the Queensland Government.
5 The relevant tiers of subcontracts are defined in s 6 of the Act.
6 With the exception of second-tier subcontractors, in the circumstances where the head contractor and the first-tier subcontractor are related entities – Part 2 Division 3 of the Act.
7 To be opened and maintained by the head contractor.
On 10 November 2017, the Building Industry Fairness (Security of Payment) Act 2017 received royal assent, affecting every stakeholder in the building and construction industry in Queensland.
On the 25th May 2017, the Minister for Housing and Public Works and Minister for Sport, Honourable Mick de Brenni, introduced into the Queensland Parliament the Building and Construction Legislation (Non-Conforming Building Products-Chain of Responsibility and Other Matters) Amendment Bill 2017 regarding the proposed new laws with respect to building product safety.