Scope of Work

A scope of work is a detailed outline of the tasks that will be completed during a construction project. It sets out the specific work that the contractor is expected to perform and forms the basis for measuring the project’s success.

It is essential to have a clear and detailed scope of work in your building contract. This will ensure that both parties have a common understanding of the project’s requirements, deliverables, timelines, and costs. It can help to avoid misunderstandings, disputes, and extra costs that may arise due to an incomplete or inaccurate scope of work.

When reviewing your building contract, you should look for the following items in the scope of work:

  • Description of the work to be performed
  • Materials and equipment to be used
  • Deadlines and timelines
  • Quality standards and expectations
  • Payment terms and conditions
  • Penalties for delays or non-performance
  • Change management procedures

A clear and detailed scope of work helps to ensure that the project is completed as expected, on time and within budget.

Related Content:

Get Your FREE Building Contract Assessment Checklist Now - Build Your Dream Home with Confidence!
When it comes to signing a building contract, there are many details to consider. Do you know what inclusions and exclusions to look for in your contract? Download our guide today to learn how to spot them and make sure you’re getting everything you need for your construction project in NSW.

Materials and Finishes

When it comes to building or renovating a property, the materials and finishes used can make a huge difference in the final result. The materials and finishes section of a building contract should detail the exact products that will be used, as well as the quality and any relevant specifications.

It’s important to review this section carefully to ensure that you’re getting the products you want and that they meet your expectations. Some items to look for in this section include:

  • The specific types and brands of materials to be used
  • The quality or grade of the materials
  • Any warranties or guarantees for the materials or finishes
  • Details about installation or finishing processes
  • Any allowances for upgrades or changes to the specified materials

By having a clear and detailed materials and finishes section in your building contract, you can avoid any misunderstandings or disputes later on.

Inclusions and Exclusions 

When it comes to building contracts, it’s essential to have a clear understanding of what is included and excluded from the scope of work. Inclusions are the items and services that are explicitly mentioned in the contract as part of the work to be done. Exclusions, on the other hand, are the items and services that are not included in the contract.

It’s crucial to have clear and detailed inclusions and exclusions to avoid any confusion or disputes during the construction process. Homeowners should carefully review these sections and ensure that they reflect their expectations and intentions.

Examples of items to look for in inclusions and exclusions include appliances, landscaping, fencing, demolition, and site cleanup. Homeowners should also pay attention to any clauses regarding changes or additions to the contract during the construction process. By understanding the inclusions and exclusions, homeowners can have a clear understanding of what they are paying for and avoid any surprises or unexpected costs.

Contract Price and Payment Terms

A building contract should clearly define the contract price and payment terms to avoid any misunderstandings or disputes. The contract price should reflect the scope of work, materials, and finishes included in the project. Payment terms should also be reasonable and clearly outlined in the contract.

It is important to ensure that the contract price and payment terms are fair and reasonable. Homeowners should be wary of contracts that offer an unusually low price or require a large upfront payment before any work has begun. Payment terms should also be clear and reasonable, with progress payments tied to specific milestones or stages of the project.

Examples of items to look for in the contract price and payment terms include the total contract price, payment schedule, deposit amount, progress payments, and any additional costs or fees. Homeowners should also review the contract for any clauses related to variations or changes in the scope of work that may affect the contract price or payment terms.

Variations Clause

A variations clause outlines the conditions under which changes to the original building contract can be made, including any costs or time implications associated with these changes. It is important to have a clear variation clause to avoid any misunderstandings or disputes that may arise during the construction process. Homeowners should review this clause carefully to ensure that they understand the conditions for requesting changes, the process for approving changes, and any associated costs or timeframes. It is also important to ensure that the variations clause is reasonable and does not give the builder too much discretion to make changes that may be outside the scope of the original contract.

Project Timeline

A project timeline is a schedule that outlines the key milestones and deadlines for a building project, from the start of construction to completion. It’s important to have a realistic project timeline in your building contract to ensure that the project stays on track and is completed within a reasonable timeframe.

When reviewing the project timeline in your building contract, be sure to look for:

  • Specific start and end dates for each phase of the project
  • Key milestones and deadlines, such as the completion of foundation work or the installation of roofing materials
  • Contingency plans or provisions for delays or unexpected issues that may arise during the project

A clear and realistic project timeline is essential for keeping your building project on track and ensuring that it is completed on time and within budget.

Builder's Warranty

A builder’s warranty is a guarantee provided by the builder that their work will be free from defects for a certain period after the completion of the construction project. It is important to carefully review the builder’s warranty before signing the building contract, as it provides a sense of security and protection for homeowners in case something goes wrong with the construction work.

Some items to look for in a builder’s warranty include the length of the warranty period, the type of defects that are covered, and any exclusions or limitations. It is also important to understand the process for making a claim under the warranty and any deadlines or requirements for doing so. A clear and reasonable builder’s warranty can give homeowners peace of mind and protect them from unexpected expenses.

Dispute Resolution Process

A dispute resolution process outlines the steps to be taken in case of disagreements between the homeowner and the builder during the construction process. It is important for a building contract to have a clear and effective dispute resolution process to ensure that any issues are resolved in a timely and efficient manner.

One of the items to look for in a dispute resolution process is the time frame for resolution. The contract should specify the maximum amount of time that can be taken to resolve disputes. Another item to consider is the method of dispute resolution, which can include mediation, arbitration, or litigation. The contract should specify the preferred method and also provide alternatives if the preferred method fails. Finally, the contract should outline the fees and costs associated with each method of dispute resolution.

Legal Advice

When it comes to signing a building contract, it’s essential to seek legal advice from a construction lawyer. This is especially important if you’re not familiar with the legal jargon and terms commonly used in building contracts. A construction lawyer can help you understand the terms and conditions of the contract and ensure that your interests are protected.

One of the benefits of having a construction lawyer review the contract is that they can identify any hidden clauses or pitfalls that you may not have noticed otherwise. They can also advise you on how to negotiate with the builder to ensure that you get a fair and reasonable contract.

While legal advice may seem like an additional expense, it can save you a lot of money and headaches in the long run. It’s always better to be safe than sorry, so take the time to consult with a construction lawyer before signing any building contract.

Contract Negotiation and Changes

When reviewing a building contract, it is important to understand that it is not set in stone. As a potential buyer, you have the right to negotiate and make reasonable changes to the contract before signing it. Negotiation can help you address any concerns you have with the contract, clarify any ambiguities, and ensure that you are satisfied with the terms of the contract. Examples of items that can be negotiated or changed include the contract price, payment terms, project timeline, and materials and finishes. It is important to note that any changes made to the contract should be reasonable and agreed upon by both parties. It is also important to ensure that any changes made to the contract are documented in writing and signed by both parties to avoid any misunderstandings or disputes later on.

Signed Contract and Record-Keeping

Obtaining a signed copy of the building contract is crucial to ensure that all parties involved agree to the terms and conditions of the agreement. It also serves as proof of the agreement in case of disputes or legal action. It is equally important to keep records of all communications and documents related to the project, including invoices, receipts, and any changes made to the original contract. Proper record-keeping can help prevent misunderstandings and provide clarity in case of disagreements or legal disputes. It is recommended to keep all records in a secure location and to have multiple copies, including electronic backups.
Get Your FREE Building Contract Assessment Checklist Now - Build Your Dream Home with Confidence!
When it comes to signing a building contract, there are many details to consider. Do you know what inclusions and exclusions to look for in your contract? Download our guide today to learn how to spot them and make sure you’re getting everything you need for your construction project in NSW.

Why Reviewing Your Building Contract is Crucial

In conclusion, taking the time to thoroughly review and understand your building contract is crucial to avoiding potential disputes and ensuring a successful construction project. It is highly recommended to seek the assistance of a construction lawyer to review and negotiate the terms of the contract. Remember to negotiate reasonable changes and keep a signed copy of the contract for record-keeping purposes.

Featured Content: Defining the Scope of Work: Ensuring Your Building Contract Covers Every Detail

Download Our Building Contract Assessment Checklist

As a construction lawyer with years of experience in this field, I understand the importance of having a clear and detailed building contract. To help you with your review process, I encourage you to download our Building Contract Assessment Checklist. This comprehensive checklist covers all the key sections we have discussed and will help you ensure that your building contract is fair, transparent, and meets your needs.