The Building and Construction Industry Security of Payment (Amendment) Act 2006 (Vic) was assented to on 25 July 2006. This Act amends the pre-existing Building and Construction Industry Security of Payment Act 2002 (Principal Act)which has been operative for some time.

Differences between the Act and the Bill

The Act as assented to is different to the Bill in only two minor ways as read for the second time. Therefore, the document entitled ‘Payment changes for building contractors’ which comprehensively described the effect of the Bill remains a correct and effective analysis of the new law. Those interested in the effect of the new Act should refer to this document.

For completeness, although they are not important enough to be mentioned in this document, the difference between the Bill and the Act as assented to are as follows:

• Clause 11: alters slightly the amendments which insert a new section 10A and 10B into the Principal Act and which deal with claimable variations.
• Clause 17: alters the amendment to clause 15(2) of the Principal Act by requiring that payment schedules must be in the relevant prescribed form (if any) and contain any prescribed information (if any).

Coming into Force of the Act

The provisions of this Act come into force in the following way.

Sections 1, 3, 38, 39 and 41 came into effect the day after the Bill was assented to, on 26 July 2006. The operation of these sections is as follows:

• Section 1 - sets out the purpose of the Amending Act
• Section 3 - defines the Principal Act, being the Building and Construction Industry Security of Payment Act 2002
• Section 38 - substitutes two provisions of the Principal Act and in particular:-

• Section 39 - provides for the service of notice including allowing service “in any other manner specified in the relevant construction contract”
• Section 41 - provides general regulation-making powers to the Governor in Council.

The remaining provisions of the Act need to be proclaimed into operation; if not proclaimed before 30 March 2007 they will automatically come into effect on that date. It is important that those affected by the Act continue to monitor its status. If it is proclaimed, it makes significant changes to the way in which the system works in Victoria. In some cases it restricts the original system whilst in other cases it expands it. We will continue to monitor the legislative framework in place. We will update you periodically on the current prcoclamation status of Act.