Build on Rock not Sand

December 18, 2014

Building a new house is probably the biggest single investment you will make during your lifetime and yet most rarely ask a lawyer to review the building contract before they sign. Engaging a lawyer later when things go wrong can lead to messy, expensive and in some cases long delays getting things back on track.   People will invest half a million dollars and yet begrudge paying a small fraction of that amount to ensure that the building contract works for them.

Below are some hints to ensure you get what you are paying for:

  1. The standard method of paying for a building is in 5 stages.   These are base, frame, lock-up, fixing and completion. There is a sixth stage – contract review.  Have the contract reviewed before you sign it.  Ideally this should be by a lawyer but also a building consultant. The lawyer for obvious reasons and the expert for very different reasons.   Are specifications full and correct? Are the estimates within range and are the allowances for prime cost items reasonable?   There are a myriad of other questions. Experienced building people will be on your side
  2. Gone are the days when the bank would inspect each stage before they made payment to the builder.  For less than $1000 your expert can do an inspection at the end of each stage to ensure that the builder has done what he promised to do under the contract. This also ensures that the builder is not overpaid and that the quality is acceptable before payment is made.  It is better to have the issues addressed up front than trying to get the builder back in some far distant future to get a fault fixed.

One thing is sure, if you fail to do the above and have a dispute with the builder after the construction has been completed and it requires legal action, then the first step is the need to have a full building inspection. This is going to cost you far more than you expected, and will only be the start of your costs in trying to get what you thought you were paying for.

As an example of the reports that you can obtain, we have provided examples of a Contract Review, and a Stage Inspection Report on our website at www.hutchinsonlegal.com.au/building-assistance along with a Capability Statement.

Feel free to call us to discuss any of these issues, and more, with one of our lawyers at Hutchinson Legal.

 

Prepared in conjunction with Buildspect Pty Ltd

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