Government of Western Australia
Department of Commerce
Maximum 50 day payment terms for
construction contracts
The Building Commission would like to remind contractors, subcontractors and suppliers
in the building and construction industry of their rights under the Construction Contracts
Act 2004 for construction contracts that state a payment term greater than 50 days.
A construction contract is defined as a contract or other agreement, whether in writing or
not, under which a person has an obligation to carry out one or more of the following:
• construction work;
• supply goods related to construction work to the site where the construction work is
being carried out;
• provide on-site services that are related to the construction work on or off the site
where construction work is being carried out.
The Construction Contracts Act limits the maximum payment term for a construction
contract to 50 days. Any provision in a construction contract that requires payment to be
made more than 50 days after the payment claim is made is to be read as being amended
to require the payment to be made within 50 days after it is claimed.
Where payment is not made within 50 days, the contractor, subcontractor or supplier
can seek rapid adjudication of the payment claim. The application for rapid adjudication
must be lodged within 28 days from the conclusion of the 50 day maximum payment term
prescribed under the Act, regardless of any longer term that has been stated.
Contractors and suppliers who believe they may be covered by the Construction Contracts
Act should seek their own legal advice if needed. Some exclusions to the Act apply,
including, on site work related to drilling and the construction of plant for the purposes of
discovering or extracting oil, natural gas or mineral.
INDUSTRY BULLETIN
• provide professional services that are related to the construction work on or off the
site where construction work is being carried out; or
Information about the Act, including how to make a payment claim and the rapid
adjudication process, can be found on the Building Commission website at
www.commerce.wa.gov.au/building-commission/payment-disputes or phone
1300 489 099.
The information contained in this bulletin is provided as general information only and should not be relied upon as legal
advice or as an accurate statement of the relevant legislation provisions. If you are uncertain as to your legal obligations you
should obtain independent legal advice.
April 2016
Building Commission | Department of Commerce
Level 1, 303 Sevenoaks Street, Cannington WA 6107
P: Locked Bag 14, Cloisters Square WA 6850
T: 1300 489 099 | F: 08 6251 1501
E: [email protected]
W: www.commerce.wa.gov.au/building-commission
IB 065/2016
Disclaimer