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202 | AUSTRALIAN HOUSE & GARDEN
Property
BEYOND WORDS
Ensure a smooth build by protecting yourself with
the necessary paperwork, writes Harvey Grennan.P
aperwork can be confusing and
boring, but you ignore it at your
peril when you’re building a house.
Proper documentation and insurances
are your ticket to avoiding problems
during the build process or obtaining
redress if things go pear-shaped.
The first batch of paperwork you need
is a comprehensive set of plans and
specifications prepared by your architect
or building designer, and approved by
the local council. These are the basis on
which the builder quotes for the job. If
the materials, fixtures and fittings are
not clearly specified, the builder is free
to choose the cheapest commercially
acceptable options. Have you specified
the type and quality of windows,
tapware, door hardware and downlights,
or termite-resistant timber for the frame?
Next comes the building contract, to
which plans and specifications must be
attached. This is the document that
outlines a builder’s legal obligations (and
yours). At the very minimum it should
cover the scope of the works, the contract
sum, how variations are to be handled,
completion time, payment terms and the
‘defects liability period’, during which
the builder must correct any faults.
Most builders use standard contracts
from Master Builders associations or
the Housing Industry Association, but
a better option is a contract from your
state’s fair trading authority. These can
be downloaded for free. Run a mile from
any builder who tells you that a contract
is not necessary or who suggests that
you take out an owner-builder permit.
“Whatever the contract, it’s important
that you educate yourself on the document
and the contract process,” says John Rees,spokesperson for the Victorian Building
Authority. “Contracts provide a baseline
in case a dispute arises between you and
your builder. If the correct information
isn’t recorded in the contract, either as
part of the original agreement or in
a variation, it’s not binding. Always
check your contract with a specialist
consultant or solicitor before signing.”
But paperwork doesn’t end there. You
should check that your builder has all the
appropriate insurances: home warranty
insurance, to cover you if the builder dies,
goes broke or disappears; public liability
and professional indemnity insurance;
worker’s compensation insurance; and
contract works insurance, to cover loss or
damage to materials or work.
“If you’re renovating or extending,
notify your home insurance provider in
writing before construction begins to
find out if your home and contents
insurance will cover damage or theft
during construction,” says Rod Stowe,
NSW Fair Trading Commissioner.
When the job’s finished, there’s one last
piece of paper: an occupation certificate.
This is provided by the local council and
is evidence that the building complies
with all council approvals and standards.
When the time comes to sell, it proves to
buyers and solicitors that the house has
not been built without approval. #Questionable policies
Home warranty insurance is a mandatory (and expensive)
requirement of building but not the safeguard you might imagine,
except in Queensland. In other states, this is ‘last resort’ insurance
and applies only if a builder goes bankrupt, dies or shoots
through. Otherwise, you may have to take civil action in a court or
fair trading tribunal. If you win and the builder still refuses to pay,
you may get a payout from the insurance provider.