Project Manager bully gets a taste of his own medicine. Contract limiting time for Payment Schedule leads to Summary Judgment for $195,000 in the face of a back charges claim for over $450,000.

Roberts Legal had prepared standard form contract for the builder approximately two (2) years earlier. Among other things, the contract terms provided that a Payment Schedule under the Building & Construction Industry Security of Payment Act could only be provided within five (5) business days of receiving a Payment Claim.

The builder contacted Roberts Legal for advice as a project worth approximately $1.3million was nearing completion. The owner was represented by a project manager who was known for asserting unmeritorious claims towards the end of a project to try to avoid payment of final progress claims.

The builder instructed that the project manager was asserting claims for back charges in excess of $450,000.00 without any prior warning.

Roberts Legal gave advice and assisted with the preparation and service of a Payment Claim under the SOP Act in the sum of $195,000.00. The claim included claims totalling approximately $92,500.00 for deemed variations and claimable costs increases within the terms of the contract that the builder had not previously considered.

Neither the owner or the project manager provided a Payment Schedule in response to the Payment Claim within the time allowed under the contract or at all.

Roberts Legal issued a detailed letter of demand under the SOP Act claiming payment of the sum of $195,000.00 plus interest by virtue of Section 15(4) of the Act. The owner obtained legal advice but refused to acknowledge the statutory debt and continued to assert a number of unmeritorious cross claims.

Roberts Legal brought an action in the District Court relying on the builder’s right to payment under the SOP Act. The owner filed a Defence in the proceedings denying that the Payment Claim was valid. Roberts Legal sent a letter identifying why the Defence was doomed to fail and inviting the owner to consent to Judgment to avoid costs of an Application for Summary Judgment.

The owner conceded the point but filed an Amended Defence.

Roberts Legal brought an Application for Summary Judgment in the sum of $195,000 plus costs which was granted despite the owner’s opposition.

How We help

Our Building & Construction Team is headed by an Accredited Specialist in Commercial Litigation and author of our popular Security of Payment Guide. Read More…

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