Browse Forums Building A New House 1 Dec 22, 2021 9:16 am We're at contract stage with our builder and I'm reviewing the HIA contract. Most of it is standard, but as others have pointed out "Special Conditions" is where the real damage can be done. I've raised these with the builder, but I want to know if my concerns are valid. See extracts below: "SC3 The builder reserves the right to alter the specifications and/or inclusions at any time to a product of similar quality." "SC6 Lock up stage - Double story designs which have lower story roofs will not have roof coverings as part of the lock up stage" "SC9 Despite anything to the contrary contained in the contract, the owner and any third parties or any other representive or agent of the owner must not enter the land without prior consent of the builder and then only by appointment with the builder and when accompanied by an appointed builders representative. The builder has an absolute and unfettered descretion to refuse consent to entry on the land subject to such conditions as the builder may impose. Non compliance with any conditions imposed on the consent to enter the land constitutes a serious breach entitling the builder to all remedies available to it in terms of this contract and at common law." "SC10 The builder resaerves the right to photograph the works during and on completion of construction for a construction record and for use by the builder for marketing and promotions." Apart from the fact that they are littered with spelling mistakes, I have very large concerns with, SC3, and SC9. SC3, sounds like it allows to them to change anything that want, and SC9 goes against Section 19 of the Domestic Building Act 1995. Am I being unreasonable by refusing to sign these? If the builder refuses to budge, we will have to walkaway from them and leave reviews that reflect our experience (factual to avoid defamation). Keen to get others thoughts on these. Re: HIA Contract - Special Conditions (Schedule 4) 2Dec 22, 2021 10:00 am Also check for any hidden 'Performance Solutions'. 3in1 Supadiverta. Rainwater Harvesting Best Practice using syphonic drainage. Cleaner Neater Smarter Cheaper Supa Gutter Pumper. A low cost syphonic eaves gutter overflow solution. Re: HIA Contract - Special Conditions (Schedule 4) 3Dec 22, 2021 10:28 am in general, legislated/statutory rights cant be contracted out of. So SC9 is sort of a moot point even though its in there. Basically if you try and get an inspector in, and the builder says "nope" and points to the contract you signed, most people would just go "damn, i missed that" and walk away. That's why its there and what the builder will rely on in the first instance. However in general, the builder can't have you sign away legislated/statutory rights. These are considered unfair contract clauses and wouldn't stand up in court. But the key here is "wouldn't stand up in court". So the challenge to you is do you have the time, patience and finances to challenge these instances in court or whatever tribunal if the issue arises mid build? Probably not. So you're screwed on that front too even though you're in the right. My suggestion is to advise the builder before signing that SC 9 tries to remove a statutory right of yours, which they cannot do and it would not stand up in court if challenged and politely request it be removed. If they're really belligerent about it, speak to a manager because the reality is if you don't sign, they don't make money. And its a small price to pay for them to have the condition removed and have to deal with your inspector compared to the alternative. Dark matter scientist, can breathe underwater, mind reader and can freeze matter just by willing it. Trust me, its in my sig. Re: HIA Contract - Special Conditions (Schedule 4) 4Dec 22, 2021 10:32 am SC9 I wouldn't worry about too much, it's void under section 132(1)(a) of the act, though you might have an argument over it. SC3 I wouldn't touch with a ten foot pole, for me that clause would have to go or I'd walk away, simply leaves you no control over the final product. Re: HIA Contract - Special Conditions (Schedule 4) 5Dec 22, 2021 10:33 am Noname in general, legislated/statutory rights cant be contracted out of. So SC9 is sort of a moot point even though its in there. Basically if you try and get an inspector in, and the builder says "nope" and points to the contract you signed, most people would just go "damn, i missed that" and walk away. That's why its there and what the builder will rely on in the first instance. However in general, the builder can't have you sign away legislated/statutory rights. These are considered unfair contract clauses and wouldn't stand up in court. But the key here is "wouldn't stand up in court". So the challenge to you is do you have the time, patience and finances to challenge these instances in court or whatever tribunal if the issue arises mid build? Probably not. So you're screwed on that front too even though you're in the right. My suggestion is to advise the builder before signing that SC 9 tries to remove a statutory right of yours, which they cannot do and it would not stand up in court if challenged and politely request it be removed. If they're really belligerent about it, speak to a manager because the reality is if you don't sign, they don't make money. And its a small price to pay for them to have the condition removed and have to deal with your inspector compared to the alternative. I've just had a chat to them and they are going to amend and make changes to the contract. Waiting to see the wording that updated, but I suspect our requests will have all been met to a reasonable standard. They have been good so far, so I don't expect them to change. I'll probably write a full builder write up at the end of the process naming them, but given what I've seen other people go through, our overall experience thus far has been positive. Re: HIA Contract - Special Conditions (Schedule 4) 6Dec 22, 2021 10:34 am SC3 is high risk. The products and material specifications are the heart of the contract. SC9 needs to be replaced with a clause that provides you or your agents with 'reasonable' access to inspect the works. Refusal to access is not legal. SC10 compromises yours and subsequent owners privacy. Construction record is ok, not marketing. Also pay attention to all the 'standard' HIA clauses and understand the financial risks to you of these. For example payment of liquidated damages, delays, etc. Amendments can be agreed to the standard clauses too. The presence of these special conditions in the contract draft are a red flag. Take care! Re: HIA Contract - Special Conditions (Schedule 4) 7Dec 22, 2021 1:00 pm Kippers01 SC3 is high risk. The products and material specifications are the heart of the contract. SC9 needs to be replaced with a clause that provides you or your agents with 'reasonable' access to inspect the works. Refusal to access is not legal. SC10 compromises yours and subsequent owners privacy. Construction record is ok, not marketing. Also pay attention to all the 'standard' HIA clauses and understand the financial risks to you of these. For example payment of liquidated damages, delays, etc. Amendments can be agreed to the standard clauses too. The presence of these special conditions in the contract draft are a red flag. Take care! Thanks for the heads up. See updated wording below. SC3 The builder reserves the right to alter the specifications and/or inclusions at any time to a product of similar quality and appearance with prior written approval from the client" Consent from client to be within 3 days. SC9 The Owner or an authorised officer of the Lending Body is entitled, after giving the Builder reasonable prior notice, to go on the Land to inspect the Building Works at reasonable times provided that such inspection does not delay or interfere with the progress of the Building Works." A Chatham Homes representative must be onsite during any inspections and access to site. SC10 The builder reserves the right to photograph the works during and on completion of construction for a construction record. If the builder wishes to use the photographs for marketing and promotions purposes, prior written consent is to be provided by the client. ------------ With regards to this comment: Also pay attention to all the 'standard' HIA clauses and understand the financial risks to you of these. For example payment of liquidated damages, delays, etc. Amendments can be agreed to the standard clauses too. I believe I understand the LD's piece, LDs have been updated to $500/week with a 2 month grace period. I'm across delays and don't envisage any from our side as planning isn't required, and the site is cleared ready to go. Anything else we should be aware of? Re: HIA Contract - Special Conditions (Schedule 4) 8Dec 22, 2021 1:34 pm I would suggest you have the wording of SC9 Amended to "The Owner, any authorised officer of the Lending Body, any building inspector or other person authorised by the Owner". This removes any uncertainty about the use of an independent inspector or other professional you may wish to view the works while the build is occurring. Dark matter scientist, can breathe underwater, mind reader and can freeze matter just by willing it. Trust me, its in my sig. Re: HIA Contract - Special Conditions (Schedule 4) 9Dec 22, 2021 2:28 pm With an additional 2 month grace period for construction delays i would be asking for any liquidated damages amounts to fully cover your accomodation, and other costs. Consider if $500 per week is enough? Check also how a 'rain day' is defined and what notification is to be provided for any delays claimed. How are current supply chain and trades labour shortages to be managed? Will these be claimed as 'out of builders control'? These items become important, particulary if you identify defects and ask the builder to fix them - which takes time and money. Ideally, you want the contract to provide the builder with sufficient financial incentive to complete the build on time, to applicable building standards. Re: HIA Contract - Special Conditions (Schedule 4) 10Dec 23, 2021 11:37 am With SC3, I won't be happy about the wording of 'at any time'. Wouldn't the builder be able to 'lock-in' all materials when they run the orders before they start the job on-site? If they find anything which is discontinued, then it's reasonable to discuss with the owner and agree on a substitute at that time. But if your contract allows them to change any product at any time with no reason provided, there is a huge risk that things can go out of your control. Once they start building, you won't really want to walk away (considering all the costs and inconvenience). You basically will have to agree with them on whatever change they propose within three days. Otherwise you will have to deal with the pains of having a dispute with your builder, and bear all costs of delays... Perhaps just let your builder know your concerns and update the wording further? You talk about deletions, are they variations or PS and PC adjustments? pleas list them 1 16542 10 12255 Unless there is something in special conditions the builder does not have to give you timeline. If your demolition contractor has not removed Asbestos and it was found… 12 28775 |