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Why every Payment Claim you submit may be void

What is the ‘Form 1’ and how strict is the Construction Contracts Act 2002 ?

What is Form 1

Form 1 is a set of written directions that you (as claimant) must provide to the recipient so that your claim is valid.

S20(3) & (4) sets out that:

“(3) A payment claim must be accompanied by—

(a) an outline of the process for responding to that claim; and
(b) an explanation of the consequences of—
(i) not responding to a payment claim; and
(ii) not paying the claimed amount, or the scheduled amount, in full (whichever is applicable).
(4) The matters referred to in subsection (3)(a) and (b) must—
(a) be in writing; and
(b) be in the prescribed form (if any).”

To ascertain the prescribed form we must refer to the Construction Contract Regulations 2003.

Schedule 1 of the regulations states that the prescribed form to be provided with all Payment Claims is Form 1.

What happens if i don’t provide it?

If you do not provide Form 1 with your claim then you will be unable to rely on the protections provided by the CCA 2002 such as default liability (where the recipient does not respond with a payment schedule). You may not be entitled to payment (but this depends on your contract).

The NZ courts have confirmed this approach on several occasions (see Sol Trustees Ltd v Giles Civil Limited [2014] NZCA539).

A copy of Form 1 is available here.

If you need help with your payment claims, or have a dispute which you would like some advice on. Contact the Contract Control team here

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