Engaging in a building contract that is inadequate has seen many families in New Zealand lose hundreds of thousands of dollars. The absence of suitable provisions in building contracts relating to essential responsibilities and obligations of builders has resulted in significant emotional and financial loss.

The Bella Vista trial in 2020 highlighted the importance of a legal review as a family was left with a house and land package without a code of compliance certificate. They needed to move in and were refused keys until they paid all money owing.

Adequate building contracts are multi-faceted. Examples of key provisions are rights and obligations of all parties involved, scope of work, payment schedules, cost of the project, date of completion, remedies, damages, and  dispute resolution clauses setting out processes to follow if things go wrong down the line.

Consumers should be aware of the legal significance and burden of their contract, knowing their rights and protections that the law provides them. Consumers should also understand the risk that is inherently involved with this type of transaction. Understanding your contract will enable you to rely and fall back on it throughout your project going forward.

Building disputes tend to occur over cost, failure to comply with obligations, expectations of the workmanship, and the estimated completion date of the project.

Building contracts should contain a wide range of provisions that cover the project as a whole. Obligations and responsibilities will likely be described with complex technical jargon that may be difficult to understand. Having an experienced lawyer review your contract will allow you to be sure you understand these obligations, as well as the risks that you are undertaking with the build.

A legal review of your building contract will require a small investment in comparison to the significant sums you may well incur in the future if issues arise that are not set out in your contract or provisions are in the contract but are inadequate.