Home build and renovation contracts part 1 - what you should know

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What leads to contractual disputes on home build projects.

​Frequently home construction projects go wrong and the contractor and the owner engage each other in lengthy and costly legal battles. These may arise because:

• There’s a poor contract in place which doesn’t adequately describe the scope of the work and the contractor’s and owner’s (your) obligations. Or, the contract is flawed with loop-holes and contradictory clauses.
• You don’t understand the contract fully, including your rights and obligations in terms of the contract.
• The contractor doesn’t understand the contract.
• One, or both parties doesn’t act in good faith, or in terms of the contract.
• There’s a lack of communication between the parties.
• One of the parties is obstinate, or doesn’t want to admit they’re wrong.

What owners must understand about building contracts

​It’s essential that:

• You understand that changes, delays and instructions caused by you, or those acting on your behalf, can have a profound impact on the project giving rise to delays and variations. Even the simplest change could have a knock-on impact on other activities which you haven’t considered or aren’t aware of.
• Your expectations should be clear, consistent and achievable from the start of the project.
• You know that failure to understand the contract, or assumptions made incorrectly, is no excuse for non-compliance of the obligations and terms of the contract.
• You understand that the contract is the law on the construction project, and all actions are judged using this document. It’s not about who will be nice, who will forgive, rather it’s about complying with the terms of the contract. The fact that the contractor has a legitimate variation claim should be no reason to argue that they’re being unfair, or to assume that they’re crooks only out to steal money from you.
• All parties continually communicate with each other, immediately notifying the other party of concerns, changes and possible impacts on the project.
• You understand that even if the contractor hasn’t said that there will be an extra cost, that this doesn’t mean there won’t be a claim from them later.
• When in doubt you ask for expert advice. 

​This is an extract from 'An Introduction to Building and Renovating Houses: Volume 1' from the chapter 'Understanding Building Processes' written by Paul Netscher.
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​Paul Netscher has written 2 easy to read books 'An Introduction to Building and Renovating Houses - Volumes 1 and 2'. An Introduction to Building and Renovating Houses Volume 1 deals with Hiring Contractors, Managing Construction and Finishing Your Home.  and Designing your ideal home Volume 2 deals with Finding Your Ideal Property and Designing Your Dream Home. 
​("Great for those that DIY. Very helpful in home renovations!" said a Reader on Amazon.com 5*****)
These books are available from Amazon and other online bookstores in paper and ebook.
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