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When Building the Dream Home Becomes a Nightmare

Comsec released their quarterly State of the States report this week confirming what many of us were suspecting: Sydney is building…big time.

In NSW, construction work completed in the June quarter was up 20.6% on the decade average and was 12.7% higher than it was a year ago.

Unfortunately, an increase in building rates may mean increased disputes between builders and clients. Building or renovating your own home is an exciting, creative and often once in a lifetime experience. Given the importance of such an event, it is extremely worthwhile having an understanding of what to do if things go wrong.

During the course of a build, it is not hard to imagine how disputes and disagreements between a client and builder may arise. If a builder believes they are entitled to a certain payment under the contract, and a client disagrees, the parties may find themselves at loggerheads. This scenario is all too common in residential building disputes.

No matter whether you think you are right or wrong, here are three important tips to remember if you find yourself in this unfortunate position.

1.  Remain Calm

Don’t take any actions that may put yourself at risk of incorrectly terminating your building contract. Disagreeing on a course of action does not necessarily give you the right to make threats against the builder, close the construction site, terminate the contract or order everyone to stop work. You could be putting yourself at financial risk by doing this.

2.  Don’t Waste Time.

In NSW, the Home Building Act states the NSW Civil and Administrative Tribunal (the Tribunal) may determine residential building disputes where the amount claimed is less than $500,000. In the event that your builder makes an application to the Tribunal, it is important that you seek legal advice from an experienced solicitor as soon as possible.

The Tribunal aims to resolve matters quickly, for the benefit of all parties. As a result, there is often a lot to prepare in a short amount of time in order to ensure you are protected legally and financially. Remember, involving lawyers in your dispute does not prevent you from coming to resolution with your builder quickly and in the event that this is not possible, an experienced commercial litigation solicitor will be able to guide you through the process.

3.  Don’t Ditch the Pen

The building process can be long and will undoubtedly involve mountains of communication between builder and client. Outcomes of disputes may depend on what was said in a conversation, sent in a text, or replied to in an email. As such, it is worth keeping a record of all building-related correspondence. Of course it is inevitable and important that conversations will happen face to face. In these circumstances, make sure that both yourself and your builder understand what is being agreed to and follow these conversations with an email or letter summary.

 

Author: Lauren Coates