Glossary of claim and contract terms

Construction payment runs on three overlapping vocabularies: the one on site, the one in your contract, and the one in the legislation. They mostly describe the same handful of things under different names, and the mismatch is why a subcontractor can read an act cover to cover and still not find the thing their contract is talking about.

This page maps them. Where a term has an article of its own, it links to it.

The documents

Progress claim. Also payment claim, progress payment claim, claim for payment, application for payment, or just the monthly claim. One document: what you serve to get paid for a period of work. Under AS 4000 it is a Progress Claim; under the Security of Payment acts and New Zealand's Construction Contracts Act 2002 it is a payment claim. See progress claims and payment claims, and what makes a claim valid.

Payment schedule. The other side's formal written reply, stating what they propose to pay and, where that is less than you claimed, why. This is the statutory name in every jurisdiction the platform covers, Australian and New Zealand alike (Construction Contracts Act 2002, ss 21 and 22). One Australian jurisdiction the platform does not cover uses neither the word nor the mechanism: in the Northern Territory the reply is a notice of dispute, on its own and much shorter clock. See payment schedules.

Progress certificate. Also payment certificate, certificate, or the assessment. The contract's name for the same reply. Under AS 4000 the Superintendent issues a Progress Certificate in response to a Progress Claim. A certificate issued under your contract is not automatically a payment schedule under the Act. It is one only if it contains what the Act requires, which is why the two words are worth keeping apart.

Statutory declaration. A sworn statement, usually that you have paid your own workers, subcontractors and suppliers for the period. No act makes one part of the claim itself, but a great many head contractors will not certify without it, and it travels with the claim as an attachment. Two acts do require a document to the same effect from a head contractor claiming on the principal: the supporting statement at NSW s 13(7) to (9) and Queensland's at BIF s 75(6) to (9), each declaring that subcontractors have been paid. Neither reaches a subcontractor's own claim.

Tax invoice. A different document from the claim, and deliberately so: when it is raised is your own accounting decision. Why a payment claim is not a tax invoice.

Final claim. Also final payment claim or, loosely, the final account. The last claim under the contract, usually the one that releases the balance of retention. Several acts give it a longer service window than an ordinary progress claim: see when you can serve the release claim. "Final account" more often means the negotiated settling-up of the whole contract sum, which may take several claims to work through.

The people

Claimant. The party making the claim: you, on this platform. New Zealand's act calls you the payee.

Respondent. The party the claim is served on, who owes the money and must reply. New Zealand calls them the payer. Usually your head contractor; on a contract direct with a developer or owner, it is them.

Head contractor. Also main contractor, builder, or the HC. The party holding the contract with the principal, and the party most subcontractors claim against.

Principal. Also employer, client, developer, or owner. The party the head contractor is building for. A subcontractor has no contract with them and generally cannot claim against them.

Superintendent. The person appointed to administer the contract and certify claims (the Australian standard forms' term). New Zealand's NZS 3910:2013 called the equivalent role the Engineer to the Contract; the 2023 edition splits it into a Contract Administrator and an Independent Certifier. Whatever the title, certifying your claim and owing you the money are different jobs: the certifier assesses, the respondent pays.

Counterparty. The platform's own word for the other side of a contract, used because the same business can be your head contractor on one job and your principal on another.

The money

Progress payment. The money itself: your entitlement to be paid for part of the work before the whole job is finished. A statutory term, and not a synonym for the claim that asks for it: three phrases, two things.

Claimed amount. What you asked for. Claims are cumulative, so a line's claimed-to-date figure is the total value of that work since the contract began, not this period's slice.

Scheduled amount. The statutory name for what the respondent proposes to pay, stated in the payment schedule. In conversation it is the certified or accepted amount.

Variance. The gap between what you claimed on a line and what was certified against it. Worth checking every month, particularly on retention. See when the numbers do not match.

Variation. Also change order, extra, or VO. Work added to or removed from the contract after signing. An approved variation is claimable scope like any other, and its value is the sum of its items.

Back charge. Also contra charge or set-off. An amount the head contractor deducts from what they owe you, for cleaning, damage, hired plant, or work they say they had to complete. It is a reduction of the certified amount and should appear in the payment schedule with a reason, not arrive as an unexplained number.

Retention. Also retentions, retention money, or cash retention. A slice of each claim withheld as security. See retention and how much is withheld.

Retention bond. A bond or bank guarantee some contracts accept instead of withholding cash. Security of a different kind, and outside what this platform tracks, because it models cash retention.

Retention release. The claim line that brings withheld retention back to you. It is not automatic, and it is not something your head contractor does unprompted: getting it back.

Contract sum. Also subcontract sum or contract value. The agreed price for the base scope. Add approved variations and you have the figure your progress is actually measured against.

The dates

Reference date. Also claim date, cut-off date, or valuation date. The day that both ends a claim period and is the earliest day you may serve the claim for it, commonly the last day of the month, sometimes a nominated day such as the 25th. It is not the payment due date. See reference dates and claim periods.

Claim period. Also valuation period or just the month. The window of work a single claim covers, ending on its reference date. Claim periods.

Business days. New Zealand's act says working days. Either way it is not calendar days: weekends and public holidays are excluded, and several acts also carve out a Christmas shutdown. Every deadline in these guides is counted in the act's own unit, on that jurisdiction's own calendar. The figures are in the timing summary.

Due date. The statutory date the payment itself falls due, counted from the date of service. Distinct from the deadline for returning a payment schedule, and not reliably after it. Later in some jurisdictions, the same day in others, and in Queensland earlier: the money can fall due before the schedule is. The figures are in the timing summary.

Practical completion. Also substantial completion or PC. The point at which the work is complete enough to be used, defects aside. It starts the defects liability period and usually triggers the first retention release.

Defects liability period. Also maintenance period or DLP. The window after practical completion during which you must return and fix defects. Its expiry is normally what makes the balance of your retention claimable, and it can run long enough to push past the ordinary service window: the last day you can serve.

When it goes wrong

Adjudication. The fast statutory dispute process every act provides, decided by an adjudicator rather than a court. Its deadlines are short and run from the payment schedule.

Determination. The adjudicator's binding decision on how much is payable. Binding on the payment, not on the parties' underlying legal rights, which can still be argued out later.

Deemed liability. What happens when no payment schedule arrives in time: the respondent becomes liable for the full amount you claimed, whether or not they agree with it. When no schedule arrives.