Reconstructing the Payment History: Progress Claims, Bank Records and Direct Payments

Build the ledger from primary records

List the deposit, each progress claim, variation, preliminary agreement, refund and direct supplier or subcontractor payment. Record date, amount, GST, payee, bank reference, invoice number and purpose.

Use bank statements as the control record, then attach invoices and receipts. Where cash was paid, identify the supporting receipt and circumstances.

Explain related-entity payments

A builder may direct payment to a finance company, development entity, director or supplier. These transactions must be explained. The fact that the builder requested the transfer does not automatically prove how it was applied under the building contract.

Retain the written instruction and reconcile the amount to the relevant claim. Seek advice where payments went to an entity that was not party to the contract.

Match money to physical progress

For each claim, identify the contractual stage and what was actually complete at payment. Use inspection reports, lender valuations, certifier records, photographs and site diaries. Note any outstanding items or disputed stage completion.

This comparison exposes paid-ahead work, duplicate charges, uncompleted variations and items supplied but not installed.

Keep claim calculations auditable

Present the ledger in chronological order and provide source-document references. Do not net unrelated amounts together. If a refund or credit occurred, show it as a separate transaction.

The same ledger can support the HBCF claim, proof of debt and replacement finance application, but each process may use the figures differently. Add columns for the amount claimed against each recovery path without changing the underlying facts.

Practical takeaway: A payment history is persuasive when another person can trace every dollar from the bank statement to the contract and the site.

How ARK Houses can help

ARK Houses can connect the payment ledger to physical progress and the measured remaining work. This supports a clearer HBCF calculation and prevents direct payments, related-entity transfers or paid but incomplete variations from disappearing into one unexplained total.

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