Construction Demand Letter For Payment Template for England and Wales

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Key Requirements PROMPT example:

Construction Demand Letter For Payment

"I need to draft a Construction Demand Letter For Payment to recover £250,000 in outstanding payments from ABC Developments Ltd for completed electrical installation works on the Manchester Shopping Centre project, with the last payment application submitted on 15 March 2025."

Document background
The Construction Demand Letter For Payment is utilized when a contractor has completed work under a construction contract but has not received payment as agreed. This document, governed by English and Welsh law, particularly the Construction Act and related legislation, formally demands payment while preserving legal rights. It typically includes details of the work completed, payment terms, amounts outstanding, and relevant contractual provisions. The letter serves as both a formal demand and a precursor to potential legal action, making it an essential tool in construction payment disputes.
Suggested Sections

1. Sender Details: Full company name, address, and contact information of the party sending the demand letter

2. Recipient Details: Full company name, address of the debtor receiving the demand letter

3. Project Reference: Contract/Project number and description identifying the specific construction project

4. Payment Details: Amount owed, payment terms, due dates, and specific payment requirements

5. Payment History: Summary of previous payments made and outstanding amounts

6. Demand Statement: Clear and unambiguous statement demanding payment with reference to relevant legislation

7. Legal Basis: Reference to relevant contract terms and legislation supporting the payment demand

8. Timeline for Response: Specific deadline for payment and consequences of non-payment

Optional Sections

1. Interest Calculation: Statutory interest calculations under the Late Payment of Commercial Debts (Interest) Act 1998

2. Previous Correspondence: Reference to previous payment requests and communications regarding the debt

3. Threat of Legal Action: Statement of intention to pursue legal remedies including adjudication or court proceedings

Suggested Schedules

1. Invoice Copies: Copies of all relevant unpaid invoices related to the construction project

2. Payment Notices: Copies of statutory payment notices issued under the Construction Act

3. Contract Excerpts: Relevant sections of the construction contract supporting the payment claim

4. Payment Schedule: Detailed breakdown of amounts owed, payment dates, and any applicable interest calculations

Authors

Alex Denne

Head of Growth (Open Source Law) @ Genie AI | 3 x UCL-Certified in Contract Law & Drafting | 4+ Years Managing 1M+ Legal Documents | Serial Founder & Legal AI Author

Relevant legal definitions
Industries

Housing Grants, Construction and Regeneration Act 1996 (HGCRA): Core construction legislation covering payment provisions, right to receive interim payments, payment notice requirements, pay less notice requirements, and statutory right to suspend work for non-payment. Amended by the Local Democracy, Economic Development and Construction Act 2009.

Late Payment of Commercial Debts (Interest) Act 1998: Governs statutory interest rates, compensation for late payment, and payment terms in commercial contracts including construction contracts.

Limitation Act 1980: Sets out time limits for bringing claims and statutory limitation periods for legal actions relating to construction payments.

Construction Act 2009: Updates to payment provisions, adjudication rights, and payment framework in construction contracts, amending the original HGCRA 1996.

Construction (Design and Management) Regulations 2015: Specifies health and safety obligations and project responsibilities that may impact payment obligations and contract terms.

The Scheme for Construction Contracts (England and Wales) Regulations 1998: Provides default payment provisions and adjudication procedures when construction contracts fail to include required terms.

Teams

Employer, Employee, Start Date, Job Title, Department, Location, Probationary Period, Notice Period, Salary, Overtime, Vacation Pay, Statutory Holidays, Benefits, Bonus, Expenses, Working Hours, Rest Breaks,  Leaves of Absence, Confidentiality, Intellectual Property, Non-Solicitation, Non-Competition, Code of Conduct, Termination,  Severance Pay, Governing Law, Entire Agreemen

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