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The HomeBuilder grant has exceeded all expectations. HIA is aware that this increase in building activity is leading to delays in both the supply of labour and materials.
There will be three stages during a residential building project when you might need to consider how to respond to delays:
Each stage will present different challenges and, if you do not factor in or respond to delays, you may be liable to compensate your client.
Ensure you have adequate time under your building period for the completion of the building project. This may mean that you need to:
While the current level of interest and activity is appealing, and you don’t want to ‘miss out’ on work, making sure you can deliver on what you commit to should be a priority.
This is particularly important given the current requirements regarding commencement timeframes under the HomeBuilder grant.
When assessing your current workload and future commitments you should consider:
Once you have signed the contract you have entered into a legally binding agreement.
Any changes must be made strictly in accordance with the contract.
Under the HIA’s Victorian New Homes and Alterations, Additions and Renovations contract you must commence building works within 21 working days after the receiving:
If an owner does not fulfil their obligations by the anticipated start date, you can seek an extension of time to give the owner more time to fulfil them. Alternatively, you may end the contract in accordance with the termination provisions of the contract.
While you are obliged to commence works within 21 days of receiving all the essential information, this may not always be feasible. You may wish to seek an extension of time to delay commencement:
Delays during construction can be frustrating and cause tension.
They can also lead to disputes.
Being aware of your rights and obligations regarding extensions of time is critical.
An extension of time may be available if the delay is:
There is a non-exhaustive list of what may constitute an extension of time under HIA contracts.
A builder is not entitled to an extension of time where the building works is delayed as a result of the builder causing the delay.
To claim an extension of time you must give the owner a written notice informing them of the extension of time. The written notice must state the cause and extent of the delay.
While there is no specified period on when an extension of time may be sought, it is recommended an extension be requested as soon as the builder is aware of the delay.
If you are unsure of the number of days to be claimed, it is be best to put the owners on notice in writing specifying that an extension of time will be claimed and that the extent of the delay will be determined at a later date.
A homeowner may dispute a request for an extension by giving the builder written notice within 7 days of receiving the extension of time. The written notice must detail why the owner is disputing the claim.
Where an owner disputes a request for an extension of time, there are 2 options:
HIA has extension of time documents available through HIA contracts online.