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  • Writer's pictureJohn Lowry

When is a Civil Contractor not a Civil Contractor?

Updated: Oct 30, 2019

Confusion still exists around when and if Civil Engineering Contractors are required to be licenced under the Queensland Building and Construction Commission (QBCC) regime in Queensland.

A contractor recently told me that he had been advised, in a phone call with the QBCC, that civil contractors are not required to be licenced. His contract is for the site preparation, site services, roads and driveways for small residential subdivisions. His contract is separate from the building contract.

The BiF Security of Payments Act - What’s in for a civil contractor?

Civil contracts generally do come under the protection of the Building Industry Fairness (Security of Payment) Act 2017 (BiF), covering the following work:

the construction, alteration, repair, restoration, maintenance, extension, demolition or dismantling of any works forming, or to form, part of land, including walls, roadworks, powerlines, telecommunication apparatus, aircraft runways, docks and harbours, railways, inland waterways, pipelines, reservoirs, water mains, wells, sewers, industrial plant and installations for land drainage or coast protection;

any operation that forms an integral part of, or is preparatory to or is for completing, work of the kind referred to in paragraph (a), (b) or (c), including— (i)  site clearance, earthmoving, excavation, tunnelling and boring;

The BiF and QBCC Acts gives civil contractors access to all the protections of the Act, including the right to seek adjudication (or apply to a court) for disputed or late payment, protection in the event of suspending work for non-payment, the protection of project bank accounts in some circumstances, the right to seek a subcontractor’s charge over moneys owed, no pay-when-paid clauses, maximum payment terns and more.

When is a Civil Contractor not a Civil Contractor?

Answer: When the contractor requires a QBCC licence.

The QBCC Act defines the requirement for a QBCC licence, as follows:

building site means a place where building work has been, is being, or is to be, carried out;

building work means:

(a) the erection or construction of a building; or

(c) the provision of lighting, heating, ventilation, air conditioning, water supply, sewerage or drainage in connection with a building; or

(e)  any site work (including the construction of retaining structures) related to work of a kind referred to above; (ie., building construction)

The QBCC Act, section 42(3), dis-entitles an unlicenced contractor to ANY “monetary or other consideration” under a contract (other than what the contractor is required to pay to subcontractors and suppliers).

There are a number of Queensland Court judgements that make it clear that a contractor who has undertaken unlicenced building work as part of a contract or subcontract is not entitled to be paid under section 42 of the QBCC Act and is not entitled to use the BiF (formerly BCIPA) to recover a disputed payment (read more about that here).

The operative words here are “where building work is to be carried out”.

We know of at least one Queensland adjudication where an unlicenced civil contractor, undertaking a subcontract for site preparation and carpark construction for a shopping centre, was prevented from accessing the BCIPA (now the BiF) Act, to recover a disputed payment claim partly because it was not licenced under the QBSA (now the QBCC).

It is likely, in the event of a disputed payment claim, that a client, on professional advice, would seek to prevent an unlicenced civil contractor working on a site where building work “is to be” carried out from ANY payment for its own work or from accessing adjudication or the Courts under the BiF Act to recover moneys owed.

This could include residential subdivision work, shopping centre carparks and other work that would normally be regarded as civil contracting, where they are in preparation for building work of any kind.

In my opinion, an unlicenced civil contractor who undertakes work on any site in preparation for or where building work is to be carried out is putting itself at risk of payment in the event of a dispute. The contractor should either obtain an appropriate QBCC licence or obtain a clear, written advice from the QBCC that it does not require a licence for the work it proposes to undertake.

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