Post Contract Variation raised by Builder

Hi,

Just want to ask your experience and expertise how to handle this matter. We signed our building contract early this year using NSW Fair Trading contract template.Our contract under Clause 10(Provisonal Sums) has 0 amount so we were not expecting any sudden extra cost. However all of a sudden, the builder has raised a variation related to additional piering and and steel reinforcement due to poor soil quality. The next day, we went to the site to check and we were surprised that the slab pouring is already in progress. Hence there was no way for us to verify if the work was actually done and if variation cost is justifiable($9,000 plus). We raised this with them and no response yet why they didn't give us a chance to verify so at least we can consent the variation. Another variation they raised is BAL 12.5 rating related works and materials as according to them it's unforseen. We signed with them as home and land package and BAL rating is already known beforehand but they did not indicate any such additional cost in the provisonal sums and not anywhere in the tender. Hence we assumed its already included in the fixed priced contract. We are contesting this with them as variation based on our understanding, are costs that are unforseen. We are not happy with it and we refuse to pay the variation they raised. Can anyone advise how should we handle this problem? The total amount of the variation is $20,000 plus and there is no way we can get finance for this on top of our existing loan. Thank you in advance.

Hi Superfly,

Request to see the structural engineering plans, this will identify if piers were required. To identify if there are piers on site would be very difficult by just looking at it.

In regards to the BAL, anybody can go to this website http://services.land.vic.gov.au/landchannel/content/addressSearch and identify if your lot requires a BAL rating or not. So this would have been identified before completing the building permit, along with any other property information. The builder would have known about this before raising the variation.

Just to confirm, $20,000 for 12.5 BAL? Jesus, how big is the home?

Hi Koda67,

We're building in NSW and yes there is a counterpart of that address search here. The 20K plus cost is the total of all like piering, steel reinforcement and BAL 12.5 related works. The land is less than 300 sqms. It's really ridiculous and we don't know how to proceed not having the extra funds to pay that extra.

Thanks again.