When Does The Pay Less Notice Regime Apply?

Laura Lintott of Dentons UK and Middle East LLP analyses the pay less notice regime in the wake of last year's Court of Appeal ruling on whether the Construction Act applies to final payment applications made after contract completion or termination.

Key points

• A review of the decision in Adam Architecture Ltd
• The Court of Appeal has held that s 111 of the HGCRA 1996 applies to both interim applications and any final account or termination account 
• An employer cannot resist a payment application without serving a pay less notice – even if the construction contract has been terminated 
• The employer must pay the sum stated to be due and argue about it afterwards

Late in 2017, the Court of Appeal (CA) was asked to decide whether s 111 of the Housing Grants, Construction and Regeneration Act 1996 (as amended in 2011) (Construction Act), applies to final payment applications made after completion or termination of the contract. Does an employer have to