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Security of Payment Act Flowchart * Important: The flowchart does not cover all situations and details of the Building and Construction Industry Security of Payment Act. For full appreciation of the rights and obligations, please consult the Act or obtain legal advice.
The Building and Construction Industry Security of Payment (SOP) Act came into operation on 1 April 2005. The Act aims to improve cash-flow in the built environment sector by giving parties the right to seek progress payment for work done. It also provides a fast and low-cost adjudication mechanism to resolve payment disputes.
- INTRODUCTION
- TWO (2) TYPES OF CONTRACTS: CONSTRUCTION, SUPPLY
- THREE (3) KEY PARTIES: CLAIMANT, RESPONDENT, ADJUDICATOR
- FOUR (4) IMPORTANT MILESTONES:
- A speedy and low-cost alternative Dispute Resolution mechanism:
The Building and Construction Industry Security of Payment (SOP) Act aims to improve cash-flow of the construction industry by (i) providing a statutory right to payment and (ii) establishing adjudication as a speedy and low-cost payment dispute resolution mechanism.
The SOP Act applies to written contracts for construction work; or supply of services or goods for construction projects carried out in Singapore. The Act does not apply to contracts for construction works or the supply of goods or services for residential properties which do not require any plan approval under the Building Control Act. For example...
claimant is a person who claims to be entitled to a progress payment under the Act. respondent is a person who may be liable to make a progress payment for the works carried out or goods and services provided by a claimant under a written contract. An adjudicator is an experienced professional who is trained by the Authorised Nominating Body (ANB) ...
Claimant issues Payment Claim Respondent issues Payment Response Parties resolve dispute in the Dispute Settlement Period Dispute not resolved, refer to Adjudication
Adjudication is a dispute resolution procedure carried out by an independent person (called the adjudicator) to determine the amount payable, if any, that is due in respect of a claim made under the SOP Act. Only a claimant can initiate an adjudication.
This revised edition incorporates all amendments up to and including 1 December 2021 and comes into operation on 31 December 2021. An Act to facilitate payments for construction work done or for related goods or services supplied in the building and construction industry, and for matters connected therewith.
Security of Payment Act Flowchart * Important: The flowchart does not cover all situations and details of the Building and Construction Industry Security of Payment Act. For full appreciation of the rights and obligations, please consult the Act or obtain legal advice. Claimant serves payment claim. Does the respondent issue a payment response?
To make a claim under the NSW Building and Construction Industry Security of Payment Act 1999, the claimant serves a payment claim on the party liable to pay for construction work or related goods or services (the respondent) under a construction contract.
SOP Flowchart - Free download as PDF File (.pdf), Text File (.txt) or read online for free. A flowchart by the Building and Construction Authority ("BCA") on the Building and Construction Industry Security of Payment Act of Singapore.
