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Charging for a quote
HIA members have raised concerns about quoting for projects free of charge and the impact this practice can have on a business’s cashflow. This is particularly an issue where a business produces detailed plans – and incurs considerable cost – in producing the quote.
Thursday, 25th March 2021
What are the legal implications of charging for a quote?
There is no legislative prohibition on charging for a quote (except in Victoria – refer to the below notation). If you intend on charging a client for a quote then it is imperative that the client is made aware of the cost of providing that quote prior to the work being performed. As always, it is best that the appropriate details are evidenced in writing and signed by the client.
Using a Preliminary Service Agreement
HIA provides a Preliminary Service Agreement (PSA) that may be used to cover work prior to signing a final contract. This contract is unique to each region due to different state consumer protection laws, but in general the PSA:
- is a one-page document that has a carbonated page to ensure both you and your client receive an exact duplicate
- provides you the opportunity to detail the work you will perform and that which you will not perform in developing the quote
-
includes a term that:
- you retain copyright in all documents that you create, and
- the agreement in itself does not create an implied licence permitting your client to use the documents.
The PSA cannot be used as a contract for the performance of ‘building work’.
Note that in Victoria, a preliminary agreement cannot be used if the preliminary works, such as plans and designs, are valued at $5000 or more.
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