Unlicenced Builders Can Not use the Payments Act to Claim Payment

Monday, 7 April 2008

The Qld Court of Appeal, in setting aside a summary judgement awarded in a lower court held that an unlicenced builder cannot claim payment under the Payments Act.

Cant Contracting Pty Ltd v  Con Casella & Anor QCA 06 - 538
In brief, Cant, an unlicenced contractor, carried out construction work and made a payment claim under the BCIPA.  Casella failed to provide a payment schedule and Cant applied, successfully, for summary judgement in the Supreme Court.

On appeal, the majority of the Court found that section 42(3) of the Building Act defeats any claim for payment under the Payments Act.  S42(3) of the Building Act provides ".....a person who carries out building work in contravention of this section is not entitled to any monetary or other consideration for doing so"

the general principles to follow appear to be:

1.  A claimant under the payments Act must be lawfully entitled to payment for construction work.
2.  Section 42(3) of the Building Act prohibits any entitlement to payment by an unlicenced contractor

The position is different in NSW, where an Act similar to the QBSA Act does not exist,  (Brodyn).

There are still occasions where an unlicenced contractor may successfully claim under the payments Act in Queensland, where the contractor is a sub-sub-contractor who does not undertake work directly or as a sub-contractor (refer R. Kohsla's adjudication decision in Brown & Moodie v HVAC).