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NSW · Updated 25 July 2026
Someone's served me a payment claim. What do I do?
You have 10 business days, and possibly fewer. Respond with a payment schedule inside that window and the dispute stays a normal argument about value. Miss it and the argument is over: you owe the whole amount claimed, and you lose the right to raise defects, backcharges or any other contract defence about it. Not "your position is weaker" — those arguments become legally unavailable.
Do these three things today
- Find the service date — the day it actually arrived, not the day it was noticed. That date starts everything.
- Check your contract for a shorter period. The deadline is 10 business days OR the contract's period, whichever comes first. A contract saying 5 means 5.
- Put the deadline in the calendar as a hard date, counted in business days — excluding weekends, public holidays and 27 to 31 December.
First: is it actually a payment claim?
A claim under the Act must identify the work, state the amount, and say that it is made under the Security of Payment Act. A document missing that last part is an ordinary invoice, and none of this applies to it.
What a payment schedule has to say
Which claim, so there's no doubt what's being responded to.
The "scheduled amount". It can be less than claimed. It can be nil.
Not a gesture at a dispute. Each reason for withholding, stated. This is where the case is won or lost.
The rule that decides most disputes: reasons left out are gone
Any reason you don't put in the payment schedule cannot be raised later at adjudication. The adjudicator will not consider it. You do not get to develop your position once you've seen theirs.
Which makes the instinctive response — "we dispute the claimed amount and will revert" — the worst of both worlds. It technically meets the deadline, and it throws away every argument you actually had. A schedule written in ten careless minutes can cost more than the claim.
Write down everything, even the reasons you think are minor or might not run. You can decline to press a reason later. You cannot add one.
Reasons that work — and one that never does
| The reason | How it has to be put |
|---|---|
| The work is defective | A defect is a valuation deduction, not a licence to withhold the lot. Identify the defect and the estimated cost of rectifying it — that estimate is what comes off. |
| The work isn't done, or isn't done yet | Say which items and what proportion. Claiming for work not carried out is a valuation point, and it's a good one when it's specific. |
| A variation was never approved | Identify the item and say it wasn't directed or agreed, and on what basis. Silence about it now means silence about it forever. |
| A backcharge or set-off | What it is, what it's worth, and where it comes from. It has to be in the schedule to survive. |
| Materials on site that aren't fixed | Unfixed materials only count where the property in them has passed, or passes on payment. |
| "I haven't been paid by the owner yet" | Never works. Pay-when-paid and pay-if-paid provisions are void in NSW. Whether the money reached you from further up the chain is legally irrelevant to what you owe down it. |
Then actually pay the scheduled amount
Scheduling an amount and then not paying it puts you in the same position as never having replied — the claimant can recover it as a debt, take it to adjudication, and suspend work on two business days' notice.
The due date is set by the Act: 15 business days after the claim where a head contractor claims on a principal, 20 business days for a subcontractor claiming on a head contractor, and for an owner-occupier contract whatever the contract says, or 10 business days if it's silent.
If you've already missed the 10 days
Don't assume it's over — but understand exactly how narrow the remaining path is, because it depends entirely on what they do next.
- If they sue for the debt: that's the end of the argument. You cannot cross-claim and you cannot raise a contract defence. The claim is effectively unanswerable.
- If they go to adjudication instead: you get a limited second chance. They must first give you notice, within 20 business days of the due date, that they intend to apply. You then have 5 business days to serve a payment schedule. That is the whole lifeline — and it only exists if they take that route.
And note what happens at the adjudication itself: if no payment schedule was ever served, you have no right to lodge an adjudication response at all. The adjudicator decides on the claimant's material. Where a schedule was served, your response is due 5 business days after you get the application, or 2 business days after the adjudicator accepts — whichever is later — and it is locked to the reasons already in your schedule.
If the adjudicator determines against you
You must pay the adjudicated amount within 5 business days. Unpaid, it converts into a judgment debt. To challenge it you generally have to pay the amount into court first, and the contract defences are not available there either.
The one comfort: adjudication is interim. It decides who holds the money now, not who was ultimately right. Your contractual rights survive and can still be litigated. But you'll be arguing them having already paid.
Owner-builders: this applies to you too
If you engage trades directly, you are the person liable to pay, and a trade can serve a payment claim on you. The old exemption for owner-occupier contracts has been repealed, and the Act reaches oral arrangements as well as written ones. The same 10 business days, and the same consequence for silence, apply on your kitchen table.
Owner-building in NSW — the full guide →
This is general information about how the NSW scheme works, not advice about your matter. Whether a document is a valid payment claim, what your deadline is, and which reasons are open to you all depend on your contract and your facts. If a claim has landed and the money matters, get advice now rather than after the window closes — the timetable does not care that you were busy.
The clock started when it arrived — not when you opened it.
A payment claim can land in a shared inbox on a Friday and be found on a Wednesday, and the deadline will not have waited. eSiteOffice reads what comes in, dates it, works out which clause and which clock it just started, and drafts the response the Act requires — with a real countdown against it. It opens in September. Tell us where you fit and we’ll send you something worth having in the meantime.