1. Field Name and Definition

A Statutory Declaration is a formal written statement of facts made voluntarily by a person (the declarant) who solemnly declares it to be true before an authorised witness. In the context of a NSW Cost Plus Payment Claim, this field contains a statutory declaration verifying that all workers and subcontractors have been paid all amounts due in relation to the work that forms part of the payment claim.

The Statutory Declaration appears on a Cost Plus Payment Claim because many construction contracts require contractors to provide this declaration as supporting evidence that they have met their financial obligations to workers, subcontractors, and suppliers before they are entitled to receive further payment.

2. Legal Requirements

Relevant Sections of the Building and Construction Industry Security of Payment Act 1999 NSW

While the Act itself does not explicitly require statutory declarations to be provided with payment claims, it is important to understand how they interact with the Act:

• Section 13 of the Act sets out the requirements for a valid payment claim but does not specifically require a statutory declaration.
• Section 34 prevents contracting out of the Act. This section has been interpreted in case law to void contractual clauses that make statutory declarations a precondition to a reference date arising or a right to make a payment claim.

Clarifying Case Law

Consequences of Incorrect Completion or Omission

The consequences of incorrectly completing or omitting a statutory declaration can be significant:

1. Legal Implications for False Declarations: Making a false statutory declaration is a serious offence that can result in penalties including fines and imprisonment under the Oaths Act 1900 (NSW).
2. Payment Withholding: As established in case law, providing a false statutory declaration can be a valid reason for a principal to withhold payment.
3. Personal Liability: Directors or officers making statutory declarations may face personal liability for false declarations, as demonstrated in 470 St Kilda Road Pty Ltd v Robinson [2017] FCA 597.
4. Effect on Payment Claim Validity: While contracts may require statutory declarations, the absence of one does not invalidate a payment claim under the Security of Payment Act.

3. Practical Guidance

Step-by-Step Instructions for Completing This Field

1. Obtain the Correct Form: Use the standard statutory declaration form applicable in NSW.
2. Complete Personal Details: Fill in your full name, address, and occupation.
3. State the Declaration: Clearly state that all workers, subcontractors, and suppliers have been paid, and all tax and insurance obligations have been met.
4. Verify Information: Before signing, ensure you have checked payment records, workers' compensation receipts, and payroll tax records.
5. Sign Before an Authorised Witness: Have the declaration witnessed by a Justice of the Peace, solicitor, or other qualified person under the Oaths Act 1900 (NSW).
6. Attach to Payment Claim: Include the completed statutory declaration with your payment claim documentation.

Where to Find This Information

• Your accounting system or payment records
• Receipts from insurers for workers' compensation premiums
• Payroll records and taxation payment receipts
• Subcontractor payment records and receipts
• Records of retention amounts held

4. Common Mistakes and How to Avoid Them

Typical Errors When Completing This Field

• Making Declarations Without Verification: Signing declarations without personally verifying the information is true.
• Incomplete Information: Omitting key information required by the contract.
• Outdated Declarations: Using declarations that do not cover the current payment period.
• Improper Witnessing: Having the declaration witnessed by someone not authorised under the Oaths Act.
• Inconsistent Information: Providing information that contradicts other parts of the payment claim.

Best Practices to Ensure Accuracy

1. Implement Verification Procedures: Establish a systematic process to verify all information before signing.
2. Maintain Accurate Records: Keep detailed and up-to-date records of all payments to workers and subcontractors.
3. Use Checklists: Develop a checklist of all information needed for the declaration.
4. Seek Professional Advice: When in doubt, consult with legal professionals about the content of declarations.
5. Establish Clear Responsibilities: Ensure the person making the declaration has access to and understands all relevant information.

5. Risks of Not Including This Information

While not providing a statutory declaration may not invalidate a claim under the Act, it can lead to significant contractual, financial, and reputational risks.

6. Examples

7. Related Fields

The Statutory Declaration is closely related to several other fields in a Cost Plus Payment Claim. Consistency is key.

• Subcontractor Costs: The declaration confirms that subcontractors listed in the claim have been paid.
• Labour Costs: The declaration verifies that workers have been paid, relating to the labour costs claimed.
• Insurance Costs: The declaration often confirms that insurance premiums have been paid, relating to any insurance costs included in the claim.
• Retention Monies: The declaration may need to address retention monies held from subcontractors, which must be consistent with retention fields in the claim.

8. Frequently Asked Questions