Contractor Payment Notice Sub-Contracts
The sub-contracts in this subfolder are suitable for all types of small scale construction project. They can be used by a builder or main contractor to engage an electrician, plumber, plasterer or bricklayer or any other specialist tradesperson.
These sub-contracts provide for a payment to be made in instalments following service of a payment notice by the contractor. Some of the templates make provision for a retention to be held by the contractor. The retained sum is paid to the sub-contractor when the defects liability period has expired, so long as the sub-contractor has remedied any defects.
All of the templates include detailed provisions to ensure the parties understand what is expected of them, thus reducing the scope for disputes. Descriptions of the main contract works and the sub-contract works need to be inserted. A timescale is set out for completion of the works and the agreement lists the day-to-day obligations of the contractor and sub-contractor. The sub-contracts have clauses dealing with payments to the sub-contractor, the sub-contractor’s liability and insurance.
In other subfolders we have construction sub-contracts providing for payment in instalments on receipt of the sub-contractor’s invoice, templates providing for one-off payment on practical completion of the works and more robust templates for larger projects.
Contractor Payment Notice Sub-Contracts is part of Property. Just £38.50 + VAT provides unlimited downloads from Property for 1 year.
Frequently Asked Questions
I would rather issue the payment notice myself than wait for invoices. Which sub-contract does that? +
A contractor payment notice sub-contract. Here you, as contractor, start each instalment by serving a payment notice on the subcontractor, rather than waiting for their invoice. It suits any trade on a small project and, like the other forms, can hold a retention released after the defects period. It keeps the payment timing in your control.
What must my payment notice say, and when do I have to serve it? +
Your payment notice must state the sum you consider due at the payment due date and the basis on which it is worked out, and it must be given no later than five days after the payment due date. Getting it out on time, with a clear valuation, is what fixes the amount payable and keeps you in control of the instalment. Keep a copy and proof of service.
What happens if I miss serving the payment notice? +
The subcontractor can fill the gap. If you fail to serve your payment notice, the subcontractor may serve a default payment notice, and the amount it states becomes the notified sum you must pay unless you then serve a valid pay less notice before the final date for payment. Missing your notice therefore hands the initiative back to the subcontractor, so treat the deadline as fixed.
Does the subcontractor still get adjudication and the right to suspend under this model? +
Yes. Whichever payment model you use, the Housing Grants, Construction and Regeneration Act 1996 gives the subcontractor the right to adjudicate a dispute at any time and to suspend performance for non-payment on at least seven days' notice. Choosing the contractor notice route changes who starts the payment cycle, not those underlying statutory rights.
