Changes to payments in construction contracts were the headline of the Local Democracy, Economic Development and Construction Act 2009 (LDEDCA) which amended the Housing Grants, Construction and Regeneration Act 1996 (HGCRA) and came into force on 1 October 2011. Contracts entered into after this date must adhere to the new process.
It is vital for a contract administrator to have an understanding of whether the Housing Grants, Construction and Regeneration Act 1996 (HGCRA) applies to the contract they are using; and if so whether the HGCRA and/or The Scheme for Construction Contracts (England and Wales) Regulations 1998 apply in their original form or as amended by the LDEDCA.
Payment provisions under the HGCRA contain strict time limits within which specified steps must be taken. If the relevant steps are not followed at the required times, the employer may be obliged to pay sums claimed by the contractor even where the contractor’s entitlement to those sums is disputed.