Why the Security of Payment Act still turns on strategy, timing and discipline

The Building and Construction Industry Security of Payment Act is often treated as a fast track to recovering money, but construction lawyer Karl Abboud argues its real force lies in how well parties understand and use its mechanisms. In a presentation for UNSW Law & Justice, he said the Act rewards precision, punishes delay and can quickly shift leverage in a dispute.

Mr Abboud, Principal Director at Abboud and Associates, framed the Act around its core purpose: keeping cash moving through the construction chain to reduce the risk that delayed payment tips businesses into insolvency. He discussed the key ‘pay now, argue later’ system that sits outside the construction contract, giving claimants an alternative pathway to pursue progress payments, seek adjudication and, in some cases, suspend works. From there, his focus turned to the practical pressure points, especially the need to get payment claims, payment schedules and due dates exactly right, given a single error can derail an adjudication or strip a party of key rights.

The sharper lesson from the session was strategic. Mr Abboud said familiarity with the Act is only the starting point: lawyers and clients also need to weigh the commercial relationship, the risk of insolvency, whether adjudication or court proceedings better serve the claim, and what information is being revealed along the way. He pointed to common mistakes such as issuing multiple claims in the same month, serving claims on the wrong recipient, relying on bare one-line payment schedules, or waiting too long in the hope payment will arrive. In each case, the message was the same: under the Security of Payment Act, small procedural missteps can have outsized consequences.

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