Before the value of the work is reached, there is a prior question: whether the payment mechanism was followed. It frequently was not.
The notified sum, and the true value.
Under the UK payment regime, a payer who fails to serve a valid payment notice or pay less notice in time becomes liable for the notified sum, whatever the underlying value of the work.
S&T (UK) Ltd v Grove Developments settled what follows: the payer must first pay the notified sum, but may then commence a separate adjudication to determine the true value of the same interim application.
So there are two distinct disputes wearing the same name. One is about notices and dates. The other is about measurement, valuation, and set-off, and it is only reached once the first is resolved.
Retention, set-off, and cross-claims sit on top, and each has its own notice requirements.
How a payment position is established.
Process before value, in that order, because the first can dispose of the second.
Map the payment cycle
Fix due dates, final dates for payment, and notice deadlines for each cycle.
Test each notice
Assess validity, content, and timing of every payment and pay less notice.
Establish the notified sum
Determine what became payable by default where notices failed.
Value the work
Measure and value the work in the relevant period against the contract.
Resolve set-off
Test cross-claims, retention, and deductions against their own requirements.
What the argument is built from.
Mostly dated documents, which is why these disputes move quickly.
Where these positions fail.
Payment disputes are lost on calendars more than on quantities.
The notice was late by a day
The regime is strict. A notice served outside the period is not a notice.
The notice did not specify the basis
A pay less notice must state the sum considered due and the basis of calculation.
True value is run too early
The notified sum must be paid before a true value determination is pursued.
Set-off has no contractual route
Deductions asserted without the notice the contract requires are simply non-payment.
What the Matter Model does with it.
It assembles the payment position across applications, certifications, notices, and withholding, and holds each against the date it was served.
Where a notice fails on timing or content, it marks the consequence for that cycle rather than leaving it to be discovered later.
Standards and authorities
- Housing Grants, Construction and Regeneration Act 1996, as amended by the Local Democracy, Economic Development and Construction Act 2009
- S&T (UK) Ltd v Grove Developments Ltd [2018] EWCA Civ 2448
General reference on how these disputes are argued. Not legal advice, and not a statement of the law of every jurisdiction or seat.
Related
Test it on a matter you already know.
Start with one completed matter.