Last Updated on 03/03/2026 by Damin Murdock
The Building and Construction Industry Security of Payment Act 1999 (NSW) (the Act) is a powerful tool for maintaining cash flow, but it is also a minefield of strict timelines. As the landmark case of Chase Oyster Bar v Hamo Industries demonstrates, even a small delay in serving a notice can render an entire adjudication void, turning a “guaranteed” payment into a costly legal defeat.
Case Analysis: Chase Oyster Bar v Hamo Industries [2010] NSWCA 190
The Background: Hamo Industries was engaged by Chase Oyster Bar to perform fit-out works. During the project, Hamo issued payment claims. Chase failed to provide a payment schedule (the document used to dispute a claim) within the required time. Under the Act, this usually means the builder is entitled to the full amount.
The Procedural Failure: Hamo intended to proceed to adjudication to recover the debt. However, under Section 17(2)(a) of the Act, a claimant must notify the respondent of their intention to adjudicate within 20 days of the payment due date if no schedule was provided. Hamo missed this window and served its notice outside the 20-day requirement.
The Adjudication and Appeal: Despite the late notice, Hamo proceeded to adjudication. The adjudicator, following the usual rules for respondents who fail to provide a payment schedule, refused to hear Chase’s defense and awarded Hamo the full amount.
Chase appealed to the Supreme Court of New South Wales, arguing that the 20-day limit was “jurisdictional.” This means that if the timeline isn’t met, the adjudicator has no legal power to make a decision.
The Judicial Outcome: The Court of Appeal agreed with Chase. It held that the 20-day notice requirement is a mandatory condition. Because Hamo failed to comply, the adjudicator was wrong to ignore Chase’s defense, and the adjudication determination was quashed (declared void).
Applied Lessons for the Construction Industry
This case serves as a critical warning for contractors relying on the “rapid fire” nature of the Act:
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Timelines are Not “Guidelines”: In Security of Payment law, missing a deadline by a single day is often fatal to the claim. Section 17(2)(a) is a strict “jurisdictional” requirement.
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The Cost of Non-Compliance: By failing to meet the 20-day window, Hamo didn’t just lose its quick payment; it was likely hit with steep Supreme Court cost orders.
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No Payment Schedule is Not a Guaranteed Win: Even if a respondent fails to provide a payment schedule, the claimant must still play strictly by the statutory rules to enforce their rights.
Security of Payment disputes are won or lost on the calendar. At Leo Lawyers, we provide the applied legal judgment to manage your payment claims and adjudication notices with surgical precision.
Feel free to contact Damin Murdock at Leo Lawyers via our website, on (02) 8201 0051 or at office@leolawyers.com.au. Further, if you liked this article, please subscribe to our newsletter via our Website, and subscribe to our YouTube, LinkedIn, Facebook and Instagram. If you liked this article or video, please also give us a favourable Google Review.
DISCLAIMER: This is not legal advice and is general information only. You should not rely upon the information contained in this article, and if you require specific legal advice, please contact us.
Damin Murdock (J.D | LL.M | BACS - Finance) is a seasoned commercial lawyer with over 17 years of experience, recognised as a trusted legal advisor and courtroom advocate who has built a formidable reputation for delivering strategic legal solutions across corporate, commercial, construction, and technology law. He has held senior leadership positions, including director of a national Australian law firm, principal lawyer of MurdockCheng Legal Practice, and Chief Legal Officer of Lawpath, Australia's largest legal technology platform. Throughout his career, Damin has personally advised more than 2,000 startups and SMEs, earning over 300 five-star reviews from satisfied clients who value his clear communication, commercial pragmatism, and in-depth legal knowledge. As an established legal thought leader, he has hosted over 100 webinars and legal videos that have attracted tens of thousands of views, reinforcing his trusted authority in both legal and business communities."
