Executive summary

The Supreme Court of Queensland’s decision in Forme Two Pty Ltd v McNab Developments (Qld) Pty Ltd [2025] QSC 96 highlights the critical importance of adhering to statutory requirements in construction contracts. In this case, Forme Two Pty Ltd sought to have an adjudication decision declared void, alleging that the payment claim did not comply with the Building Industry Fairness (Security of Payment) Act 2017 (Qld) (BIF Act). The Court found that the payment claim failed to meet the requirements of s75(2)(b) of the BIF Act, which mandates that a payment claim is issued within six months after the works or supply of goods the subject of the payment claim were last carried out or supplied. As a result, because no payment was claimed for work carried within six months before the payment claim, the adjudicator lacked jurisdiction, rendering the adjudication decision void.

Summary

In Forme Two Pty Ltd v McNab Developments (Qld) Pty Ltd [2025] QSC 96, the Queensland Supreme Court confirmed the calculation of the dates in which a payment claim can be issued under the Building Industry Fairness (Security of Payment) Act 2017 (Qld) (BIF Act).

Forme Pty Ltd (Forme Two), sought to have an adjudication decision (Decision), which awarded $162,505.081 in favour of the first respondent, MacNab Developments (Qld) Pty Ltd (McNab), declared void in whole or part.

The central issue was whether the Decision was affected by jurisdictional error, specifically, whether the payment claim complied with the requirements of s75(2)(b) which mandates that payment claims must be made within six months after the construction work or related goods and services to which a payment claim relates was last carried out.

The Court declared the Decision void, as the payment claim was made more than six months after the last work being performed.

Background

In or around August 2022, Forme Two engaged McNab in relation to a development in New Farm. The engagement was pursuant to an unsigned contract.

On 17 January 2024, McNab purported to issue a payment claim to Forme Two under the BIF Act. The accompanying letter indicated that the claim was for “works completed up to the 25th day of December 2023,” which was the relevant reference date for the claim under the contract.

On 18 February 2024, Forme Two responded with a payment schedule, stating that the amount to be paid was $nil, along with reasons for withholding payment.

On 23 February 2024, McNab applied for adjudication of the payment claim and the following month, the adjudicator issued the Decision in favour of McNab on 20 March 2024.

Forme Two commenced proceedings in the Supreme Court of Queensland seeking to have the Decision declared void because it was based on an invalid payment claim.

The evidence before the Court was that the last work was performed on 7 May 2023, and McNab did not dispute that the payment claim did not include any claim for any amount on account of work undertaken during the period six months before the payment claim was given.

In finding that the payment claim was invalid, Hindman J considered that it is a basic and essential requirement of a valid payment claim that it includes a claim for work carried out in the six months prior.

What do you need to do?

To avoid a similar outcome, businesses should implement robust systems to track contract reference dates, ensure payment claims are issued in accordance with s75(2) of the BIF Act, and maintain detailed records that substantiate not only what work was completed, but also when the work was completed.

While a payment claim can include work which was performed more than six months prior, the payment claim must claim payment for work or goods carried out or supplied within six months of making the payment claim, unless one of the longer timeframes applying to the final payment at s75(3) applies.

Seeking legal advice when preparing or responding to payment claims that may be controversial can provide an added layer of protection against inadvertent non-compliance with the BIF Act.

How can HWLE help you?

At HWL Ebsworth Lawyers, our construction and infrastructure team specialise in guiding businesses through the complexities of security of payment legislation across all jurisdictions. Our experienced legal team works closely with businesses to assist with navigating the complexities of the security of payment legislation, assisting with drafting payment claims, payment schedules and in circumstances where a dispute has occurred, providing strategic support throughout the adjudication processes, aiming to protect our clients’ interests and maintain the financial health of their projects.

This article was written by Colin Harris, Partner and Zeena Lederhose, Solicitor.