Contract Preparation

If your Strata, bodies corporate, community or company title scheme is thinking of engaging a builder to do residential building work, many jurisdictions require that you must have a contract in writing (based on the contract price)

The contract must then comply with the requirements of the relevant legislation. It is of course advisable that any agreement for work being done by a builder be set out in the form of a contract.

A contract for building work to be done will usually not just consist of a form of agreement. Quite often, the contract is made up of plans, specification, quotations and other documents. It is important that the contract sets out how each of these documents interact with each other.

There are a suite of standard form contracts for building work in existence. Standard form contracts have been issued by the Office of Fair Trading (in various States/Territories, Standards Australia and the Master Builders of Australia. Unfortunately, many consumers of these products fail to realise that these standard form contracts may not necessarily comply with the requirements of their particular circumstances.

The problem can be made worse when a Strata Scheme or Community Association is presented with a contract prepared by the builder. The terms of the contract may heavily favour the builder, particularly when it comes to variations and payment.

Many contract disputes can be avoided by investing time in ensuring that the contract you are about to enter:

  • complies with the relevant legislation (where necessary);
    is properly executed by all parties, and that the builder is appropriately licensed;
  • is tailored to meet the requirements of the work to be undertaken; and
  • has reasonable and fair terms.

A significant issue for Schemes is the fact that in many cases, the building in which the work is to be done will remain occupied. Some of the standard form contracts require possession of the site to be provided to the builder, to the exclusion of the owner. The standard form contracts in this regard usually require significant changes and additions to ensure they are compatible with the day-to-day operation of the Strata.

Our experience in the preparation of building contracts allows us to provide a complete service to clients, from defect claim or a Home Owners Warranty Claim right through to rectification of the defects. Grace Lawyers can:

  • advise you in relation to building related contracts, for example, contracts for remedial works, superintendents, architects and project managers;
  • prepare all types of building contracts; and
  • negotiate building contract terms on your behalf.