Clients Rights and Obligations
PREPARE A STEP BY STEP PROCEDURE TO ADVISE THE CLIENT OF THEIR SA CONTRACT TO BUILD.
Using the Consumer Building Guide as a base, prepare a process to advise the client of the following:
A) List what Licensing would be required by the builder and tradespeople to build their home.
B) List what the builder actually does.
C) Explain what Home Wa
anty Insurance is, who applies for it, when and what it covers.
D) Provide a
ief summary of the Development Application Process and what Regulatory Compliances
need to be adhered to.
E) Explain the role of the Accredited Certifier and the Principal Certifying Authority.
F) Explain what the Statutory Wa
anties are and how they apply to the contract.
G) Explain why and when a contract is necessary.
H) Nominate what contract will be used and explain the client’s rights and obligations regarding: -
- Prime Cost Items
- Variations
- Progress Claims & Payment of Claims
- Dispute Resolution
**Ensure you note where the information was obtained from and who the Author is for this
question.
How to Write a Procedure
A Procedure is a step by step way of ca
ying out a task.
Be specific – point form is acceptable but must be in the co
ect order If you use the point form
system – always begin the section with a short preamble (only requires a sentence or two) outlining
what the general procedure is then follow with the relevant steps.
Include in the procedure -
1. WHO is responsible for each task
2. WHAT each task is
3. HOW each task is to be ca
ied out
4. WHEN each task is to be implemented.
You must include a copy of the relevant documents, when they are to be completed, by whom and
when.
Sometimes it is hard to know where to start. Set out your ideas in the following order:
Rules 1. DO’S List - your rules first (policies) regarding each phase/section of the
task
2. DO NOT List what must not be done
PROCEDURE Step by
Step tasks to ca
y
out the role
1 - Who is responsible
2 - What needs to be done first
3 - What needs to be next
4 - Now list how it is to be done
5 - In what timeframe is each step to be ca
ied out
6 - If it is applicable – nominate where the task should be ca
ied out OR
where information can be obtained
7 - If it is applicable – nominate how the process is to be recorded or
documented
SUPPORT
DOCUMENTS
1.List the co
ect document that must accompany each document
2. Provide an example of each document
3.YOU MUST INCLUDE SAMPLE DOCUMENTS –
OBLIGATIONS OF
THE PARTIES
1.PRINCIPAL, CONTRACTOR, SUPERVISOR, SUBCONTRACTOR, WORKER etc
2.Where applicable insert what each officer’s obligations are
CONTINGENCY List any ‘what to do if the wheels fall off’
REVIEW PROCESS 1.By Whom, When, Frequency
2.Report Process
3.Follow up
Version 2 – Effective from January 2020
This guide has been developed by the QBCC in accordance
with Schedule 1B of the Queensland Building and Construction
Commission Act 1991 (‘the Act’) to assist home owners undertaking
domestic building work with a contract price of $20,000 or more.
It’s aimed at helping you avoid disputes and common pitfalls.
COOLING-OFF PERIOD
You may withdraw from the contract within 5 business days after
the day you receive copies of both the signed contract (including
any plans and specifications) and this guide. However, there are
costs for home owners in withdrawing (generally $100 plus any
out-of-pocket expenses reasonably incu
ed by the contractor
up to the time of withdrawal). You must advise the contractor in
writing that you are withdrawing under the cooling-off provisions
in section 35 of Schedule 1B of the QBCC Act.
QBCC LICENCE
You should only deal with a QBCC-licensed contractor. If you
engage an unlicensed contractor, your building work may not be
covered under the Queensland Home Wa
anty Scheme. Before
committing, check the contractor’s licence and history via the
Online Licence Search on the QBCC website or by calling the QBCC.
QLD HOME WARRANTY SCHEME
Residential construction work valued at more than $3,300 is
covered by the Queensland Home Wa
anty Scheme. The Scheme
provides protection for home owners against non-completion,
defective work and subsidence for up to 6 years from completion,
provided a licensed contractor performs the work. The building
contractor must collect the premium from the owner and pay it to
the QBCC within 10 business days after the date the contract was
entered into or before the contracted work is started (whichever is
earlier). You should receive an email with a Notice of Cover and links
to important information about the cover provided within 2 weeks
of signing the contract.
WARNING – COST PLUS AND CONSTRUCTION
MANAGEMENT CONTRACTS
QBCC strongly recommends home owners obtain formal legal
advice before signing either of these types of contracts which
increase your legal risk, reduce your Home Wa
anty Scheme
protection and often result in disputes and cost ove
uns.
COMMENCEMENT NOTICE
For contracts priced at $20,000 or more, the contractor must give
the owner a signed Commencement Notice within 10 business days
of work commencing on site. The Notice must state the date work
started on site and the Date for Practical Completion.
CONTRACT PRICE
For contracts priced at $20,000 or more, the contract price,
if fixed, must be shown prominently on the first page of the
contract schedule. If the contract price is not fixed, the method
for calculating it, including any allowances, must be stated in the
contract schedule. Allowances (items or services for which the
price is not fixed when the contract is signed) should be kept to
a minimum as the final cost often exceeds the estimate in the
contract. The contract must also contain a warning about any
provisions that may alter the contract price.
DEPOSIT LIMITS
The maximum deposit allowed (before work starts on site) is:
• 10% where the total contract price is less than $20,000
• 5% where the price is $20,000 or more
• 20% for a contract of any price where the value of the work to be
performed off-site is more than 50% of the total contract price.
PROGRESS PAYMENTS
After the deposit is paid, owners and contractors are free to choose
the number and timing of progress payments (if any) for their project,
provided the amount claimed is directly related to work progress on
site and proportionate to (or less than) the value of the work that
elates to the claim.
BUILDING APPROVALS AND INSPECTIONS
Building inspections and approvals are the responsibility of a
uilding certifier. Mandatory building inspections may be required
at certain stages of construction. The contractor must give you
copies of any certificates of inspection as soon as practicable after
they receive them from the certifier. You can check the certifier’s
licence via QBCC’s Online Licence Search.
VARIATIONS
Any change to the materials used or work to be performed under
the contract is known as a ‘variation’. Variations are frequently the
cause of cost ove
uns and building disputes. All variations must
e agreed in writing by the home owner before the variation work
commences and any price increase due to the variation can not be
equired to be paid until the variation work is started.
DISPUTE PREVENTION
To reduce the risk of a dispute, carefully check and be sure you
understand the contract, including any plans and specifications,
efore signing. Discuss any questions with your contractor and
seek independent legal advice if you still have concerns. Once
construction starts, maintain regular communication and, where
possible, site inspections with your contractor and pay promptly
when required under the contract.
CONSUMER BUILDING GUIDE
Your contractor must give you this guide before you sign a contract priced at or over $20,000
http:
www.qbcc.qld.gov.au
Version 2 – Effective from January 2020
DISPUTE RESOLUTION
If a dispute with your contractor occurs, firstly advise them in
writing giving them a reasonable time to respond. If this doesn’t
esolve the problem, explore QBCC’s free Early Dispute Resolution
(EDR) service and your legal options. QBCC recommends you obtain
independent legal advice before terminating the contract. Inco
ect
termination may have serious legal and financial consequences and
educe your protection under the Qld Home Wa
anty Scheme.
EXTENSIONS OF TIME (EOTs)
The contract must state the Date for Practical Completion for
your project, or how the date is to be determined (e.g. 180 days
from commencement). The Act sets out circumstances in which
a contractor may seek to extend this date (e.g. if you approve a
variation to the contract which involves extra work, or the work
is inte
upted by more rain than could reasonably have been
anticipated). The contractor must give you a written EOT claim
which you should carefully consider (not unreasonably reject) and
espond to promptly in writing. If you approve the claim, the Date
for Practical Completion will be extended by the period claimed. If
you do not approve the claim, the extension is deemed ‘disputed’.
LIQUIDATED DAMAGES (LDs)
LDs are contractual payments to compensate a home owner for
extra costs/losses they are likely to incur (e.g. extra rental costs) if
the contractor fails to complete the work within the time allowed
for in the contract (after allowing for legitimate extensions of time).
Carefully consider what, if any, LD amount is appropriate for your
project and ensure it is recorded in the contract.
PRACTICAL COMPLETION AND HANDOVER
You are not required to pay the final contract payment until all
of the contracted work has been completed in accordance with
the contract including any plans and specifications, all legal
equirements, and either without any defects or omissions, or with
only minor defects or minor omissions that will not unreasonably
affect occupation. If you believe there are any minor defects or
minor omissions, the contractor must give you a ‘defects document’
(listing agreed and non-agreed matters). This document