Back off, that's my security!: Accessing security under a building contract in Queensland

Key message

Section 67J of the Queensland Building and Construction Commission Act 1991 (QBCC Act) requires a party to a building contract, before using security under the contract, to:

• give notice advising of the proposed use and of the amount owed, and
• give that notice within 28 days after the party becomes aware or ought reasonably to have been aware of the party's right to obtain the amount owed.

The effect of the decision in Beyfield Pty Ltd v Northbuild Construction Sunshine Coast Pty Ltd [2014] QSC 12 is that, in order to use a security (eg. bank guarantee), a party must demonstrate compliance with the conditions in section 67J that there is a "debt due" and that it has given notice as required by section 67J.