Stick to the contract: QBCC warns public over making extra payments
Business
The State Government has issued a rare public warning about builders seeking extra payment outside the terms of a contract.
The Queensland Building and Construction Commission statement follows turmoil in the building industry caused by escalating costs, labour shortages and delivery delays caused by Covid.
Several major construction companies have already collapsed, including Condev and Probuild, and residential builders are facing major cash flow problems, some of which have been shifted to the customer and costs have spiked significantly.
“Homeowners are urged to seek legal advice before making payments that fall outside the terms of a fixed price building contract under the guise of contract variations to protect themselves from unwarranted payments,” QBCC said.
QBCC commissioner Anissa Levy said there may not be any contractual basis for contractors to demand payment for increased labour and material costs as contract variations under a fixed price contract.
The commission said shortages in supplies and labour was Australia-wide and were impacting everyone in the supply chain, from suppliers and builders to subcontractors, employees, and consumers.
“It is expected it will take some time for the industry to get back to its usual supply and operating rhythm,” the QBCC said.
