Making amendments to your building contract

Changes may be due to legislation amendments, a change of the client’s mind or a delay with supply. The most appropriate way to make changes will depend on the type of change required.

Using variations

Variations are used to amend or remove a particular scope of works relating to the design of the plans, materials and any unforeseen matters discovered on site.  

For example, if a particular tile was selected by the homeowner at the time of contract execution and is no longer available by the time the builder approaches the particular stage of the building works, the builder in this instance may submit a variation to either remove the tiling works or substitute the selected tile for an alternative type.

Or, if the homeowner wants to perform an aspect of the building works themselves – whether this is because they think they can supply and perform the works for a lesser price or they wish to engage their own tradespersons mid build – this can be raised in a variation to remove that particular scope from the builder’s overall workmanship.

It is important for builders that all variations are signed before commencing the amended building works, as this is required under the Domestic Building Contracts Act 1995 (Vic) (DBCA). This ensures that both parties are aware of what the changes are so to minimize the potential for misunderstandings that often lead to costly disputes.

Making manual amendments

Minor errors can be fixed by making manual amendments to the Schedules of the contract.

For example, builders can amend spelling errors relating to the name of the client by crossing out the name and replacing it with the correct spelling. The builder will need to ensure that the client consents to this change by initialling and dating the area of change.

Attaching an addendum

An addendum is a separate document that forms part of the agreement which details the changes that a builder (or homeowner) wishes to make after a contract has been signed and is neither permitted under a variation nor is there sufficient space within the contract to illustrate the changes to be made.

For example, the builder may amend the progress payment schedule by redrafting the schedule on the addendum. Should this occur, the builder is to ensure that a special condition is drafted to reflect the applicability of the new schedule.

Whether it is a progress payment schedule, or some other change that requires an addendum, it is important for builders (ideally with the assistance of a construction lawyer) to draft a special condition that refers to how the addendum forms part of the existing building contract with the homeowner.

It is also important to ensure that both parties sign and date the attachment to show that there is an agreement to the terms of the addendum.

The above is intended to provide general information in summary form. The content does not constitute specific advice and should not be relied upon as such. Formal advice should be sought by members and customers with respect to particular matters before taking action.