A claim sent at 7:18pm on a Friday was served that day, so the head contractor’s payment schedule was late

What happened

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

1. 1 February 2023 — Roberts Co, the head contractor, engages Sharvain, the subcontractor, for design, construction and façade work on the paediatric services building at Westmead Hospital. Claims are made through Payapps. Clause 29.2(2) of the subcontract says that a notice received after 5pm on a business day is treated as received at 9am on the next business day [2], [15]–[21].
2. Friday 28 February 2025, 7:18pm — The subcontractor uploads a $3,207,999.03 payment claim to Payapps. Payapps sends it to the email address of the representative the head contractor has nominated. Nobody at the head contractor sees the claim before 3 March [23]–[25].
3. Friday 14 March 2025 — This is the last of the 10 business days after 28 February [39].
4. Monday 17 March 2025 — The head contractor provides a payment schedule. The schedule proposes a negative amount, because the head contractor says it has a cross-claim larger than the subcontractor’s claim [27].
5. 12 June 2025 — Stevenson J holds that the clause is void under s 34 of the Act (the section that stops a contract from excluding or changing the Act), and gives judgment for the subcontractor [1], [32].
6. 23 July 2025 — The Court of Appeal dismisses the head contractor’s appeal and orders it to pay the costs [46].

The rule

Under s 31(4) of the Act, “serve” includes give, send or otherwise provide. The claim was served on 28 February because it was sent that day and could be retrieved that day. Nobody at the head contractor had to be aware of it [36].

It made no difference that the claim arrived after business hours, because the law does not count parts of a day [36]. McHugh JA reached the same result under s 31(1)(d). The head contractor had specified the email address, and service by email happens when the email can be retrieved at that address [49]–[50].

Under s 14(4), a payment schedule is due by the earlier of two times: the time the contract sets, and 10 business days after the claim is served. “Served” here means served under the Act. A contract can shorten the 10 business days, but it cannot lengthen them [37], [51].

Even if the clause had worked, the contract’s time would have run from 3 March to 17 March, while the Act’s 10 business days ran out on 14 March. The earlier of the two times applies, so the payment schedule was late either way [38]–[42]. The Court of Appeal did not decide whether the clause was void under s 34 [43], [53].

What it means for you

If you’re paying: count your 10 business days from the day the claim reaches the address you nominated. That is so even if the claim arrives after hours and nobody opens it [25], [36], [50]. On this decision, a clause in your contract that treats the claim as received at a later time will not give you more time [37]–[42].

If you’re the trade: a claim you send after hours to the address the other side nominated is served that day. Keep the confirmation the system sends you. In this case, Payapps confirmed the claim almost immediately [25].