Contracts are a necessary evil in the building industry. They not only protect you and your client but they an essential tool in ensuring you’re both on the ‘same page’ about work to be undertaken.

Despite often being required, one of the most commonly misunderstood contracts is the Australian Building Industry Contract for Simple Works and Major Works (ABIC SW & MW – 2008). Master Builders Legal Manager, Angelo Simonetto, said there were three important parts of the contracts that builders often lacked understanding about. 

“There’s a general lack of understanding of what this contract is about, especially in regard to making valid claims for variations, extension of time and how to dispute a superintendent certificate,” Mr Simonetto said.

“It’s important to understand variations because undertaking work without an approved and signed variation in place could mean you won’t get paid,” he said.

“Likewise, it’s crucial that builders understand how to put in an extension of time claim in a timely manner. Failure to do so could mean they may be liable for liquidated damages that results from time blow outs.”

In addition builders often lack understanding of how to and by when they can dispute a superintendent certificate under the ABIC SW & MW. The ‘superintendent’ issues a number of certificates including one at completion. This certificate then entitles the builder to be paid. In some cases the superintendent will issue a certificate of lesser value than what the builder has claimed, prompting a builder to dispute the certificate.

“Many builders don’t realise that they only have a strict time period of 20 days within which they can dispute a superintendent’s certificate,” Mr Simonetto said.

“Failing to dispute it within the time limit will bar them from being able to do so at any time in the future.”

Mr Simonetto said that these were all common issues on most building projects where the ABIC SW & MW contracts are used and builders should be aware that these contracts deal with these issues in a very unique way.

“Misunderstanding how to deal with these three key provisions, can be a trap for those who are inexperienced with this type of contracting,” he said.

To help inform builders, KO Lawyers Principal Kelvin Oldridge will be presenting at the next Master Builders Legal Seminar titled Variations, extension of time and superintendent certificates – what you should look out for. This seminar is aimed at domestic and commercial builders and will help you to better understand how to use these contracts to ensure you are better protected.

“By coming to the seminar, builders will gain an awareness of the traps that exist when dealing with variations, extensions of time and disputing an architect’s certificate under this contract, so when confronted with them they will be better able to understand how to administer this contract,” Mr Simonetto said.

Guest presenter, Kelvin Oldridge, has extensive experience as a construction lawyer, having previously worked in Australia and overseas as a project manager and contract administrator. 

For more information or to register for this legal seminar, click here or call Master Builders on (03) 9411 4555.

Master Builders Legal Seminar

Topic: Variations, extension of time and superintendent certificates – what you should look out for.

Date: Thursday, 15 May.
Time: 5.30 to 6.30pm.
Venue: Master Builders, 332 Albert Street, East Melbourne.
Cost: $30 for members. $100 for non-members.

Book now.