NSW Adjudication

Building and Construction Industry Security of Payment Act

Does the Act apply to me?
What is Adjudication?
How do I apply for Adjudication?
What fees are involved in Adjudication?
How can I use the Act to best effect?
What is an Adjudication Certificate?
Adjudication Certificate Checklist
Can the timelines under the Act be extended?
What happens after an Adjudication Application is made?
Why use IAMA?

Does the Act apply to me?

The Act applies to the carrying out of construction work and to the provision of related goods and services.
The work or related goods and services must be provided under a construction contract. The contract can be written or oral, or partly written or partly oral.
The Act does not apply to construction work carried out outside NSW.
There are a number of limitations as to the application of the Act. See section 5, 6 and 7 of the Act.
The Act applies to residential building work except for parts of premises where the the party for whom the work is carried out resides in or proposes to reside in those parts of the premises.

What is Adjudication?

Adjudication under the Act is the process where an independent person (the adjudicator) makes a determination as to the amount (if any) which the respondent is to pay to the claimant, on what date it was (or will be) due to be paid, and what interest rate is to apply.
The adjudicator must be appointed by an authorised nominating authority chosen by the claimant. The Institute of Arbitrators and Mediators Australia (IAMA) is an authorised nominating authority.
When the claimant lodges an adjudication application with IAMA, IAMA refers the application to an adjudicator. IAMA has more adjudicators than any other nominating authority. In fact IAMA has over 60 trained, experienced and accredited adjudicators which enables applications to be dealt with very quickly.
IAMA aims to have the adjudicator commence the adjudication within 4 business days of the application being made to IAMA. The adjudicator will generally complete the determination within 10 days of his or her commencement.
Adjudication is carried out on the basis of the documents submitted by the parties to the dispute. In determining an adjudication application, the adjudicator is to consider only the provisions of the Act, the provisions of the construction contract, the payment claim, the payment schedule (if any), submissions made in accordance with the Act by the claimant and respondent, and the results of any inspection carried out by the adjudicator.The adjudicator may also call a conference.
The adjudicator's determination will be in writing. The adjudicator will set out the reasons for his or her decisions (unless the parties agree that they do not require reasons). The adjudicator will also decide what proportion of the adjudicator's fees and expenses are to be paid by each party.

How to apply for Adjudication

Applicants should fill in an “Adjudication Application Form”
The Adjudication application is then submitted to IAMA (the address is on the form)
The application fee must accompany the application
A copy of the Adjudication application must be served on the respondent
Section 17 of the Act sets out the requirements for an Adjudication Application.

Sample Adjudication Application form (Word 32kb)

Adjudication Fees

IAMA provides fixed price adjudications for some adjudication applications subject to certain conditions. The following fees are for the nomination, adjudicators fees, and the issue of an adjudication certificate for disputes up to $20,000. Please read the conditions carefully.

Adjudication Application Fee
Claimed Amount	Fee for Application, Adjudicator, and Certificate
Up to $10,000 (excl GST)	$1,100 (incl GST)
Up to $20,000 (excl GST)	$2,200 (incl GST)

Conditions apply to the above fixed fee adjudications:

Fixed fees do not apply where IAMA considers that an adjudication application contains or relates to a complex adjudication or an adjudication application involving an amount of material or issues which, in IAMA's opinion, cannot be dealt with in a short period of an adjudicator's time.
If IAMA advises that it will accept an adjudication application as a fixed fee adjudication the fee to be provided with the adjudication application will be $1,100 (incl GST) for claims up to $10,000 (excl GST) or $2,200 (incl GST) for claims up to $20,000 (excl GST).
For all other adjudication applications the following adjudiation application fees shall apply:

The following fees are for the nomination and do not include the fees charged by the adjudicator

Adjudication Nomination Fee
Claimed Amount	Application Fee
Less than $200,000	$165 (incl GST)
$200,000 - $1,000,000	$385 (incl GST)
Over $1,000,000	$660 (incl GST)

The Act requires that the adjudication application must be accompanied by the application fee
Some claimants may also request IAMA to issue an adjudication certificate. IAMA's fee for issuing an adjudication certificate is $275 (including GST)

How can I use the Act to best effect?

Make sure you are fully informed about the Act. The Act imposes very strict limits on the parties and the adjudicator.
Claimants should ensure that their payment claims are fully detailed so that the respondent has a proper opportunity to understand what is being claimed and what the basis of the claim is. The payment claim must be made within the times allowed by the Act and must be served in accordance with the Act.
If the respondent disputes the payment claim the respondent should ensure that they issue a payment schedule which complies with the Act. The payment schedule should set out all of the reasons why the respondent intends to pay less than the amount claimed. The payment schedule should also include any reasons the respondent has for withholding any part of the payment. The payment schedule must be provided within the times allowed by the Act and must be served in accordance with the Act.
Claimants should ensure that their adjudication application includes a copy of the contract or a submission as to what the contract is if all or part of the contract is oral. The application should also inclue a copy of the payment claim and the payment schedule, together with any submissions or supporting documents which the claimant wishes to provide. The claimant may not have another opportuntiany to provide any submissions or other supporting documents. The adjudication application must be made within the times allowed by the Act and must be served in accordance with the Act.
Provided that the respondent has issued a payment schedule in accordance with the Act, the respondent may make an adjudication response. The response should contain submissions and supporting documents. The respondent is restricted by the content of the payment schedule as to what reasons can be addressed in the adjudication response. The adjudication response must be provided within the times allowed by the Act and must be served in accordance with the Act.
IAMA runs regular workshops and seminars for industry, adjudicators and advisers. IAMA can also arrange presentations by experienced accredited adjudicators on request.

What is an Adjudication Certificate

Five business days (or later if the adjudicator determines that it should be later) after the adjudicator's determination is served on the respondent, the respondent must pay the adjudicated amount to the claimant.
If the respondent fails to pay the adjudicated amount to the claimant within the time required, and if the adjudication application was made to IAMA, the claimant may request IAMA to provide an adjudication certificate.
IAMA will set out in the certificate the names of the claimant and the respondent, the adjudicated amount and the date on which the amount was due to be paid to the claimant.
IAMA will include in the adjudicated amount the amount determined by the adjudicator, the amount of interest, and if the claimant has paid the respondent's share of the adjudication fees for which it has not been reimbursed, IAMA will also inlcude that unpaid share of the fees.
The adjudication certificate, if it is accompanied by an affidavit of debt, can be filed in any court of competent jurisdiction, as a judgement for a debt and is enforceable accordingly.

Adjudication Certificate - Application Checklist

BCISOP Act Section 24

Download the Adjudication Certificate Application Form

The application for the certificate is then submitted to IAMA with the application fee ($275 inc. GST).

Complete an affidavit to enable the adjudication certificate to be filed as a judgement debt and file at court of relevant jurisdiction.

Download Affidavit Sample

Section 24 of the Act sets out the requirements for requesting an Adjudication Certificate.

Can the timelines under the Act be extended?

The only times which the Act expressly allows to be extended are the time for making further submissions if the adjudicator calls for further submissions and the time for the adjudicator to make the decision.
The time for making further submissions (if the adjudicator has called for further submissions) may be extended by the adjudicator.
The time for the adjudicator to make the decision can only be extended by both the claimant and the respondent agreeing to the extension. The Adjudicator has no authority to extend the time without this agreement.
If your place where you may be served a document under the Act is going to be unattended for any reason you should ensure that someone checks for any documents served. It is very easy to fall foul of the strict time limits imposed by the Act.

What happens after an Adjudication Application is made?

After the adjudication application has been submitted, IAMA will refer the application to the adjudicator whom it considers the most appropriate to adjudicate.

The adjudicator will communicate her or his acceptance of the adjudication application to the parties.

All correspondence should be with the adjudicator rather than with IAMA from this point forward. All correspondence sent to the adjudicator by a partymust also be copied to the other party.

The adjudicator has certain limitations which the Act imposes but any questions regarding process from this point on should be directed to the adjudication as processes vary between adjudications.

Why use IAMA?

IAMA is a not-for-profit and independent organisation.
Low application fees.
IAMA has over 60 trained, experienced and accredited adjudicators.
IAMA always has adjudicators to deal with any application quickly and professionally.
IAMA can choose the most appropriate adjudicator to suit the application.
IAMA provides regular training and workshops to adjudicators, advisers and industry.
IAMA is Australia's premier, independent, largest and most experienced adjudication, arbitration and mediation service.

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