If you’re embroiled in a payment dispute over the festive period, getting the timing right could be critical

Take down your tree, put away those mince pies and take off that silly hat! Christmas is cancelled. At least, it could be if you get your deadlines wrong under the Construction Act.

The deadlines under the Act require careful attention year-round. However, calculating them over the Christmas period can be especially tricky. Should Christmas Day be counted? What about Boxing Day? And what’s the status of the “substitute” holidays on 27 and 28 December? Most importantly, how can you make sure those pesky deadlines don’t interfere with your Christmas plans?

Deadlines under the Construction Act

The Act requires that the referral of a dispute to an adjudicator is provided within seven days of the notice of adjudication.

Under the Act, and if the Scheme applies, payment is due seven days after the relevant period (28 days if it’s not defined). You then have five days to issue a payment notice, and a withholding notice must be issued at least 10 days before the final date for payment. The final date for payment is 17 days after the due date for payment.

And you really don’t want to miss these deadlines - failing to provide a referral notice in time (or a late adjudication decision) means the resulting adjudicator’s decision could be invalid. Forgetting the payment and withholding notices provides the contractor with an easy way to enforce payment through adjudication.

Calculating time periods under the Act

First of all, your calculations should start from the day after the start of the time period. For example, if payment is due seven days from 1 December, you count seven days starting from 2 December to reach 8 December as the due date.

And what about the Christmas period? The Act states that you should exclude Christmas Day and any bank holidays from your calculations. (Interestingly, Christmas Day is a public holiday rather than a bank holiday, and so has to be dealt with separately.)

This year 27 and 28 December 2010, and 3 January 2011 are all bank holidays. Boxing Day and New Year’s Day are not, as they fall on weekends, and so should be counted.

In practice

Let’s say you leave work at lunchtime on Christmas Eve, and are away from the office until 30 December. On your return, you find a notice of adjudication on your desk dated 24 December. The referral notice is due within seven days. But seven days from the 24 December is 31 December, isn’t it? Well, no - not according to the Act. The referral notice will be due on 4 January 2011.

How do we calculate this? We exclude Christmas Day as a special case under the Act and 27 and 28 December 2010 and 3 January 2011 as bank holidays), but include Boxing Day and 1 January as they are not bank holidays.

The Act provides some (but not much) breathing space over Christmas. But, it can still be fiddly calculating deadlines around this period. Some days sound like they should be bank holidays but aren’t (look at Boxing Day and New Year’s Day).

Make sure you count your days carefully when working out deadlines, and try to provide the notice or the payment well in advance of this. The consequences of missing a deadline would make a terrible start to the New Year.

Fiona Swords, Pinsent Masons