Adequately Protecting Construction Insolvencies: Disposition of Trusts to Facilitate Security of Payment in Australia

Abstract

Responsibility for ensuring prompt payment and preventing default in the construction industry in Australia is placed on the security of payment legislation. A recent surge of insolvencies among construction entities suggests that this legislation is failing in its ambitions. The recent Collins inquiry suggests that the imposition of one of several trust regimes would provide the industry with the protection it requires to curb the insolvency surge. The purposes of this article are to investigate whether the imposition of a trust regime is appropriate to obtain the required outcomes and to propose a regime structure based on an analysis of the available options.