How do you recover retention?
Check when the contract says retention is released, usually at practical completion and at the end of the defects period. Then make a written claim for the release as soon as the date arrives.
What retention is
Retention is a part of each payment that the client holds as security. It protects the client if work is defective or unfinished. The contract sets the percentage and the release dates.
Many contracts release half at practical completion and the rest at the end of the defects period. Yours may differ.
Steps to get it back
- Read the retention clause and note each release date.
- Diary those dates well ahead.
- Clear the defects list before the date.
- Issue a written claim for the release on the due date.
- Follow up in writing if there is no reply.
If the money is not paid
Check whether a security of payment claim is available. Every Australian state and territory has its own security of payment law, and some treat retention differently. For example, Queensland has a payment claim process under the BIF Act, with a payment schedule due within 15 business days of the claim.
Retention rules and time limits are legal matters.
Related answers
Questions
Can the client keep retention for unfinished defects?
Often the contract lets them hold back enough to cover the defects. Fixing the defects removes that reason.
Can I swap retention for a bank guarantee?
Many contracts allow it. Check the security clause and ask the client.
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