WA Supreme Court confirms strict timeframes under new SOPA

The recent decision of the Supreme Court of Western Australia in Martinus Rail Pty Ltd v Co-Operative Bulk Handling Ltd [2025] WASC 373 (Martinus Rail) reinforces the critical importance of strict compliance with the statutory timeframes prescribed for responding to payment claims under the Building and Construction Industry (Security of Payment) Act 2021 (WA) (Act).

Decision

In Martinus Rail, the Claimant served a payment claim by email late on Saturday, 31 August 2024, seeking payment in excess of $22 million.  Although the Respondent received the email on the same day, it did not open the payment claim until the following Monday, 2 September 2024.  The underlying contract contained a deeming provision stipulating that notices received on non-business days are deemed received at 9:00am on the next business day.

The Respondent contended that, pursuant to this contractual clause, the payment claim was effectively received on Monday, thereby delaying the commencement of the 15 business-day timeframe to provide a payment schedule in response.  The Claimant argued that the relevant statutory provisions in the Act, the Building and Construction Industry (Security of Payment) Regulations 2022 (WA) (Regulations), and the Electronic Transactions Act 2011 (WA) (ET Act) govern when a payment claim is deemed to be given, thus overriding any contractual deeming clauses.

The Court accepted the Claimant’s position, holding that:

1. Under regulation 23(d) of the Regulations and section 14 of the ET Act, electronic communications are deemed given when they become capable of retrieval;
2. The statutory timeframes for payment schedules prescribed by the Act are mandatory and cannot be extended, modified, or excluded by contract;
3. Contractual deeming provisions relating to notices do not alter when a payment claim is deemed to have been given under the Act; and
4. Consequently, the Respondent failed to provide a payment schedule within the prescribed 15 business-day timeframe as required by the Act and was therefore liable for the full amount claimed by the Claimant.

Practical Implications

This decision confirms the importance of the statutory timeframes under the Act over any conflicting contractual notice provisions in Western Australia.

Respondents should exercise vigilance when payment claims are served, especially on weekends or public holidays, as the statutory timeframe may commence immediately upon the payment claim becoming retrievable.

Drafters of contracts are advised to carefully review notification and deeming provisions to ensure alignment with the Act, thereby avoiding clauses that conflict with the statutory framework.

Disclaimer

The information contained in this publication does not constitute legal advice and should not be relied upon as such. You should seek legal advice in relation to any particular matter you may have before relying or acting on this information. The Lavan team are here to assist.