A builder served no payment schedule, and the court gave a plumber judgment for its $221,901 claim

What happened

Source: the judgment on NSW Caselaw. Numbers in [brackets] are the judgment’s paragraphs.

1. Manariti Plumbing, the plumbing subcontractor, does the plumbing on a multi-dwelling housing development that Universal Property Group, the builder, is building at Lochinvar [3]. The plumber’s earlier invoices claim the work at unit prices and quantities, and the builder pays them [19], [27].
2. 31 March 2024 — The plumber emails the builder invoice 284 for $221,901. The invoice says it is a payment claim under the Act for work from 21 June 2023 to 12 January 2024. The plumber attaches a spreadsheet titled “Spreadsheet showing losses” [4], [11].
3. The spreadsheet adds up the plumber’s actual labour, oncosts and materials ($360,457.23). It then adds 15% “profit” ($54,068.60). It then deducts the $192,625 the builder had paid on ten earlier invoices, which it lists by number [17], [24]–[26], [51]. That leaves $221,901 [22]. The plumber has sent no earlier invoice for the last 12 days of the period, 1–12 January 2024 [18], [52].
4. The claim does not explain why the plumber has changed from a fixed price to cost plus [27]–[28].
5. The builder serves no payment schedule and does not pay [5].
6. 10 April 2024 — The plumber sues the builder in the District Court and asks for summary judgment, which is judgment without a full trial [6], [8]. The builder argues that the claim does not identify the work, and that it is not a claim for construction work [7]. The District Court refuses summary judgment. It holds that whether the claim is valid is a real issue that needs a trial [8].
7. 19 June 2025 — The Court of Appeal gives the plumber leave to appeal and allows the appeal. It gives the plumber summary judgment for $221,901 plus interest, and orders the builder to pay the costs [68].

The rule

Under s 13(2) of the Act, a payment claim must identify the construction work, indicate the amount claimed, and state that it is made under the Act [31]. A claim fails to identify the work only if the failure is obvious on the face of the claim. It is enough that the claim sets out, in a reasonable way, to identify the work [40], [45]. A claim can do that by referring to documents the other party has already been given, such as earlier invoices [47], [49], [51].

The Act does not secure payment of damages or restitution [56]. But the court held that this is not a condition of a valid payment claim [58], [63]. Whether the amount is payable under the contract is a question for a payment schedule and, if needed, for an adjudicator to decide [60], [65].

If the respondent (the party who receives the claim) does not serve a payment schedule in time, it becomes liable for the claimed amount on the due date (s 14(4)) [33]. If the claimant then sues for that amount, the respondent cannot raise a defence about matters arising under the contract (s 15(4)(b)(ii)) [34], [64]. The court said that a respondent who serves no payment schedule effectively gives up the right to resist the claim on that basis [65].

What it means for you

If you’re the builder: if a claim re-prices work you have already paid for, or has no basis in the contract, say so in a payment schedule and serve it in time [65]. If you cannot identify some of the work in the claim, say that in the payment schedule too. Do not ignore the claim [41].

If you’re the trade: a claim can identify the work by stating the period and listing the numbers of earlier invoices. That was enough in this case. It was also enough for the last 12 days, which had no invoice, given the ten earlier invoices listed in the claim [51], [52]. This decision is about whether the claim was valid. Whether the money is owed under the contract is a separate question, which is decided if the respondent raises it [60].

Either way: progress payments are payments on account. They do not affect the parties’ final rights under the contract (s 32) [42].