Head contracts and subcontracts often state that payment claims served by email (or project management software such as Procore/Payapps) after 5PM are deemed to be received the next business day (or similar for post, emails, etc…).

When are emails received? 

In the judgment of Stevenson J in Sharvain Facades Pty Ltd (Administrators Apptd) v Roberts Co (NSW) Pty Ltd [2025] NSWSC 606, a subcontractor claimed $3.2M under section 15(2) of the Security of Payment Act (see our post on How to obtain judgment under s. 15 of the SOP Act) on the basis that it contended the contractor failed to give a payment schedule with the 10 business day period after the payment claim was received.

The only issue in dispute was the date the payment claim was received.

The subcontract listed the permitted means of serving payment claims, one of which was service via Payapps (a project management software).  The subcontract specified that service effected after 5PM on a business was deemed to be received at 9AM the next business day (deeming provision).

The subcontractor sent a payment claim using Payapps at 7.18PM on 28 February 2025.   The Payapps application immediately auto-generated and sent an email attaching the payment claim, to 5 representatives of the contractor.

But for the deeming provision, s. 13A of the Electronic Transactions Act 2000 (NSW) would have determined the date of service as the time at which the email was capable of being retrieved by the recipient at a designated email address.

The Court determined that the deeming provision left it to the parties to decide with what speed the processes under the Security of Payment Act should operate – which was found to be purport to modify the operation of the Security of Payment Act.   The Court found that the deeming provision was void for all purposes pursuant to section 34 of the Security of Payment Act and concluded that the Electronic Transactions Act determines the date of receipt of the payment claim (being 28 February 2025).

The Court delivered judgment in favour of the subcontractor for the full amount claimed in the payment claim.

How can a builder or subcontractor minimise risk?

Determining the date of receipt of an email can be tricky. Deeming provisions make this even more confusing – particularly, given that under the Security of Payment Act deeming provisions relating to the time of receipt of a payment claim will likely be void.

If there is doubt about when to serve a payment schedule, best practice is to assume the earliest possible date and submit your payment schedule by that date (or earlier, if you can).  We know that sometimes that is not possible and our Construction + Projects team are ready and available to help you navigate the unforgiving and brutally short deadlines under the Security of Payment Act.