Construction Contracts Act 2013
Arbitration and Mediation
The Construction Contracts Act 2013 applies to construction contracts entered into after 25 July 2016. The main features are as follows:
- Irrespective of the provisions of the subcontract, subcontractors are entitled to be paid the full value of work completed every 30 days.
- The paying party must respond to a payment claim within 21 days of the payment claim date. If it fails to do so, it runs the risk of having to pay the full amount of the claim, irrespective of how inflated it may be.
- Any dispute relating to payment may be referred to an adjudicator at any time. The adjudicator must give a decision within 28 days, and the amount awarded by the adjudicator is payable immediately, irrespective of the fact that the dispute may then be the subject matter of arbitration or litigation.
- Pay when paid provisions are no longer permitted.
Practitioners advising clients involved in the construction industry need to be aware of the detail of this very short but important statute.