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ARTICLE · 03 OCTOBER 2023

WA Regulation Of Performance Security In Contracts

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All participants in the construction industry should be aware of legislative provisions that apply to performance security in more recent construction contracts for projects in Western Australia...

AustraliaReal Estate and Construction
Sandra Steele
Sandra Steele
Alex Rickarby
Alex Rickarby
Natalie Hazzard
Natalie Hazzard
Andrew Blyth
Andrew Blyth

All participants in the construction industry should be aware of legislative provisions that apply to performance security in more recent construction contracts for projects in Western Australia.

The changes create new statutory rights and obligations relating to performance security and also regulate the use, access to, and return of performance security, regardless of the agreed terms of construction contracts.

Overview

Performance security is given by a contractor under a construction contract to secure performance of the contractor's obligations. It is held for the benefit of project owners (under a head contract) and head contractors (under a subcontract). The holding party's right to access and to have recourse to the performance security is governed by the terms of the relevant contract.

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