Unit 4003A Handout HIA Contract Use for Observation Scenario.pdf
OWNER/S – Peter Thompson
JOB LOCATION – Lot 810 Viewhill Court, Doreen
HIA Membership No. 912757
VICTORIAN
NEW HOMES CONTRACT
OCTOBER 2004
HOUSING INDUSTRY ASSOCIATION
AHB Australia Pty Ltd
TO VERIFY THAT YOUR BUILDER IS A MEMBER OF THE HIA
CALL 1902 973 555
©COPYRIGHT HIA 2004
All rights reserved. No part of this document may be reproduced, stored, copied, distributed
or transmitted in any form or by any means without the prior written consent of HIA.
How to Complete and Sign a HIA Contract
A contract is comprised of three sections
Preliminaries:
SECTION A - HIA Contract
First Page - Insert Owners Name
Second Page* - Attention to the Purchaser - Purchaser to Sign & Date
Third Page* - House Contract - Purchaser to Sign & Date
Fourth Page - Customer Privacy Statement - Purchaser to Sign & Date
Sixth Page - Checklist – Purchaser to Sign & Date
* This page may not be in some contracts
Particulars of Contract
Page One - Insert owners name, current address, phone numbers and lending body
- Purchaser to initial page
Page Two - Purchaser to Sign where it says “Signed Owner/s”
- Witness to sign where it says “Signed Witness”
- Date Page
- Purchaser to initial page
Pages 3 to 9 - Purchaser to initial each page
Page 10 - Purchaser to Sign
- Purchaser to initial page
Page 11 - Purchaser to initial page
Page 12 - Purchaser to Sign, Print Name and Date
- Purchaser to initial page
Pages 13 to 38 - Purchaser to initial each page ( Page 36 is intentionally blank)
Page 39 - Owners Consent Form - Insert “Owners Name”, “Address”,
- Insert “Job Address”
- Sign, Print Name and Date
- Purchaser to initial page
Page 40 - Account Closure & Transfer Request
- Completed Sections 2, 3 and 4 (Ignore date of account closure/transfer section)
- Purchaser to initial page
SECTION B - Specification
AHB Tender Document – 3 pages - Purchaser to enter Name, Address, Phone numbers and email details
- Purchaser to Sign & Date all three pages
AHB Invest Specification – 3 pages - Purchaser to Initial & Date all three pages
Fencing Request - 3 pages - Complete and sign only ONE form relevant to the property location
SECTION C- Plans
Purchaser to Sign & Date every page
ATTENTION TO THE PURCHASER
Please read this document carefully before signing.
This Building Contract contains the entire terms agreed between the Builder and the Purchaser.
The Purchaser acknowledges and agrees that no Sales or Marketing Agent or Consultant has the authority from
the Builder to make representations or assurances on behalf of the Builder or do anything else on behalf of the
Builder other than what is set out in the building contract.
The Purchaser promises that no representation, warranties or assurance, unless set out in this Building
Contract have been made to the Purchaser by the sales or marketing agent or by any other third party which
have influenced or induced the Purchaser to enter into this Building Contract.
Further, the Purchaser acknowledges and agrees that the Builder will not be liable for:
a) Any representation or assurance made by on or behalf of the Builder; or
b) Any advice, representation or assurance made by any sales or marketing agent in connection with
taxation, property, investment or the property market, which may or does result on any loss, expense,
cost or liability to the Purchaser,
Unless the representation, assurance, advice or warranty is set out in this Building Contract.
The Purchaser acknowledges that no real estate agent, tradesman, consultant or other person employed or
engaged by the Builder has the authority to waive or amend any terms of this Building Contract.
The Purchaser promises to the Builder that it has not relied on any artist’s impression, model, display unit,
sketch, specification or sales aid of any description except the documents contained in this Building Contract.
The provisions of this clause, which forms part of the Building Contract, are a complete bar to any claim made by
the Buyer in connection with any alleged misrepresentation or misleading and deceptive conduct if any claim is
based upon representations not contained in this Building Contract.
The Purchaser:
a) Acknowledges that the Builder has not authorized any party to make representations on it’s behalf
regarding on-sales of the property prior to completion;
b) Acknowledges that the Builder repudiates any such representation purported to be made on it’s behalf;
and
c) Agrees that the builder is not liable for any such representation.
In this case, unless the context otherwise requires, the terms “Building Contract” includes, the Tender Document
(if any) and all statements and materials obtained in them.
Peter Thompson
Purchaser
Supreme Constructions Pty Ltd Peter Thompson
Builder Purchaser
___________________________ ____________________________________
Date Date
House Contract
Special Notes and Conditions
1. The Purchaser is responsible for the following items, following endorsement of the AHB Australia Pty Ltd
Tender Document
If finance is required to compete the purchase then, within 7 days of the Contract being signed,
making a formal loan application with a Lending Authority for a loan to ensure the Purchaser is able
to complete this purchase;
Providing evidence to the Builder within 30 days of endorsement of the AHB Australia Pty Ltd
Tender Document that the Purchaser has sufficient funds to complete the purchase and in the event
that the purchaser obtains finance from a Lending Authority the Purchaser must provide the Builder
with a copy of a letter confirming the finance has been unconditionally approved;
Endorse any Contracts of Sale or Building Agreements provided by the Builder within 7 days of their
production;
Select one of the professionally pre-selected colour schemes (Pre-selected schemes may not be
able to amended);
Endorse any documents required by their lender or the Builder to ensure that construction
commences in accordance with the terms of the Contracts;
Provide the Builder with written ‘‘Owners Consent Form”.
Any failure by the Purchaser to ensure the above items are completed in a timely fashion may, at the
Developers discretion, result in the property being placed back on the market for sale.
2. No allowance has been made for the variations and amendments that are not stated in this contract. This is
a fixed price contract for the specific works and inclusions noted in this document and does not provide for
unseen land or permit conditions.
3. This contract is valid for a period of 90 days from the day it has been signed by the owner and the builder, by
which time the Builder anticipates receiving the final authority to commence construction. This authority to
commence is in effect once the Builder has received confirmation, either from the Purchaser or their Lender,
that any mortgage documents have been signed, proof that land settlement has taken place, and colour
selection has been signed and if required under the terms of the Contract, consent to build has been
received. After the expiration of 90 days from the day of signing this contract the builder is entitled to charge
the building owner a further 3% of the contract price
4. If the Purchaser intends to obtain the First Home Owners Grant then the Builder warrants that it has not
made any promises to the Purchasers that they will qualify for the Grant. The Grant is accessed and
administered by the Government Authority that the Builder has no control or influence over.
5. This contract is based on the price being paid by progress payments being nominated in the Contract.
6. The working drawings in this contract may not be the final drawings and may change as a result of
developers requirements, statutory, council or other regulatory requirements, cross over location and other
requirements as may arise from time to time.
Purchaser’s signs as acknowledgement of understanding and acceptance:
Purchaser: - Peter Thompson Date
Customer Privacy Statement
AHB Australia Pty Ltd through its subsidiaries offers a wide variety of new unit, house and land products and related finance services.
The AHB Australia Pty Ltd, through its offices and agents, needs to collect personal information from its customers so that we are able to:
Coordinate and administer the provision of products to you the customer;
Determine your ongoing unit, house and land requirements and service needs;
Provide the appropriate products or service;
Improve our product range and services.
Without such information, we cannot provide the product or service concerned and would be unable to do business with you.
All the companies that form the AHB Australia Pty Ltd may, from time to time provide personal information about customers to each
other and to all companies with whom the AHB Australia Pty Ltd, deals.
The companies and associated subsidiaries which are part of the AHB Australia Pty Ltd include, but are not limited to, the following:
AHB Australia Pty Ltd
AHB Holdings Pty Ltd
AHB Developments Pty Ltd
Progress 168 Pty Ltd
Synergy 168 Pty Ltd
PKG Pty Ltd
Manor Lakes Real Estate
Protecting your privacy is a priority in the AHB Australia Pty Ltd normal business practices and operations.
We cannot disclose personal information to any third party organization, with the exception of those organizations contracted to members
of the AHB Australia Pty Ltd to provide administrative services or activities in servicing our client’s needs.
When communicating personal information to third party organizations, the AHB Australia Pty Ltd will take reasonable steps to ensure
that the relevant third party organization not only has an appropriate privacy regime in place, but is also bound by the same privacy rules
we follow.
Occasionally, the AHB Australia Pty Ltd might use personal information to provide you, the customer with product related material on a
range of those products and services offered by our unit, housing or finance divisions. This information will be provided by the AHB
Australia Pty Ltd
You as the customer may at any time:
Change your mind about receiving product related material or information;
Process personal information that we hold about you;
Obtain more information about the AHB Australia Pty Ltd
Obtain a copy of our Privacy Policy.
You may make any of these enquiries by writing to telephoning or visiting the relevant office.
In signing the new home quotation document, you agree to allow the AHB Australia Pty Ltd collect, use and disclose your information,
including where necessary, sensitive and health information, in accordance with the AHB Australia Pty Ltd Privacy Statement
incorporated in this document and the AHB Australia Pty Ltd Privacy Policy.
Purchaser’s signs as acknowledgement of understanding and acceptance:
………………………………………………. ..……………………………………………….
Purchasers Signature: - Peter Thompson Purchasers Signature: - Peter Thompson
…………………………………… ……………………………………………
Date: Date:
NOTICE APPROVED BY THE DIRECTOR OF
FAIR TRADING AND BUSINESS AFFAIRS
PURSUANT TO SECTION 31 (n)
OF THE DOMESTIC BUILDING CONTRACTS ACT 1995
COOLING OFF PERIOD
NOTICE TO BUILDING OWNER: YOU MAY END THIS CONTRACT WITHIN FIVE CLEAR
BUSINESS DAYS AFTER RECEIPT BY YOU OF A SIGNED COPY OF THE CONTRACT BY
FILLING IN THE NOTICE BELOW AND GIVING IT TO THE BUILDER IN ONE OF THE
FOLLOWING WAYS:
(1) PERSONALLY;
(2) LEAVING IT AT HIS OR HER ADDRESS SET OUT IN THE CONTRACT WITH A
PERSON WHO APPEARS TO BE AT LEAST 16 YEARS OLD;
(3) SENDING IT BY PRE-PAID REGISTERED POST TO THE ADDRESS SET OUT IN
THIS CONTRACT;
(4) SENDING IT BY FACSIMILE TO THE FACSIMILE NUMBER (IF ANY) SET OUT
IN THIS CONTRACT.
....... ............................................................................................................................. .
DETACH ALONG DOTTED LINE
NOTICE THAT CONTRACT IS ENDED
A Building Owner cannot withdraw from a contract under the Act if:
1. The Builder and the Building Owner have previously entered into a major domestic building
contract that is in substantially the same terms for the carrying out of the work in relation to
the same home or land; OR
2. The Building Owner received independent legal advice from a practicing solicitor concerning
the contract before entering into the contract.
To Pasquale Garofalo ........................................................................................................... (Builder)
I/We .................................................................................................................................... give notice
under our contract with you that the Contract is ended. Please refund the deposit less $100 and any
out of pocket expenses incurred by you which I have previously approved.
Building Owner's signature Peter Thompson
Date: / /
NOTICE APPROVED BY THE DIRECTOR OF FAIR TRADING AND
BUSINESS AFFAIRS PURSUANT TO SECTION 31 (r)
OF THE DOMESTIC BUILDING CONTRACTS ACT 1995
CHECKLIST
BEFORE SIGNING THIS LEGALLY BINDING CONTRACT
CHECK THIS LIST
Has an insurance policy or certificate of currency for builder's insurance been
issued and provided to you? If not, the Contract is conditional upon you receiving
either an insurance policy or a certificate of currency for builder's insurance.
If this Contract is conditional upon the Building Owner receiving written approval
for finance has the Building Owner obtained such approval?
YES or NO
YES or NO
If you answer 'no' to any of the following questions you are not ready to sign the Contract
Has the Building Owner had this Contract long enough to read and understand it? YES or NO
Has the Building Owner been provided with evidence that the Builder named in
this Contract is registered with the Building Practitioners Board?
YES or NO
Are the price and progress payments clearly stated? YES or NO
Does the Building Owner understand how the price is calculated and may be
varied?
Has the Builder assessed the suitability of the site for the proposed works and if
tests are necessary have they been carried out before signing the Contract?
YES or NO
YES or NO
If a Deposit is payable, is it within the legal limit? YES or NO
The maximum under the Domestic Building Contracts Act is:
i 10% if the Price is less than $20,000; or
ii 5% if the Price is $20,000 or more.
Is the work shown and described clearly in the Contract, plans or specifications
and any other relevant documents such as engineering computations or soil
report?
Are the Building Owner's special requirements or finishes included in the plans or
specifications?
Are the commencement date and completion date clearly stated or capable of
being ascertained?
YES or NO
YES or NO
YES or NO
YES or NO
Is the procedure for extensions of time understood? YES or NO
Are any 'provisional sums' or 'prime cost items' clearly stated in the schedules and
understood?
YES or NO
Is the procedure for variations of plans or specifications understood? YES or NO
Do you understand the circumstances in which you can end the Contract? YES or NO
NOTE: This checklist does not form part of the Contract.
Read, signed and dated by the Building Owner ...Peter Thompson
Date: / /
INDEX
Page
PARTICULARS OF CONTRACT ................................................................................................. 1, 2
SCHEDULE 1 ............................................................................................................................... 3, 4, 5
SCHEDULE 2 Prime Cost Items and Provisional Sums ..................................................................... 6
SCHEDULE 3 Construction Stages and Table ................................................................................... 7
Method 1 Progress Payments ......................................................................... 8
Method 2 Progress Payments ......................................................................... 9
ATTACHMENT 1 .............................................................................................................................. 10
SCHEDULE 4 Special Conditions .................................................................................................... 11
SCHEDULE 5 Excluded Items ......................................................................................................... 11
SECTION A INTERPRETATION
Clause 1 Definitions .............................................................................. 12, 13
Clause 2 Headings, Footnotes, etc .............................................................. 14
Clause 3 Contract Complete in Itself .......................................................... 14
Clause 4 Joint and Several Obligations ....................................................... 14
Clause 5 Assignment and Sub-letting ......................................................... 14
Clause 6 Notices.......................................................................................... 14
SECTION B MAIN OBLIGATIONS OF THE PARTIES
Clause 7 Building Act Insurance ................................................................ 15
Clause 8 Finance ......................................................................................... 15
Clause 9 Deposit ......................................................................................... 15
Clause 10 Builder's Commencement and Completion Times ................. 15, 16
Clause 11 Statutory Warranties ..................................................................... 16
Clause 12 Owner Must Pay the Contract Price ....................................... 16, 17
Clause 13 Owner Must Provide Essential Information ................................. 18
SECTION C BEFORE WORK BEGINS
Clause 14 Owner to Supply Documents ....................................................... 19
Clause 15 Copyright ..................................................................................... 19
Clause 16 Interpretation of Contract Documents 19, 20
Clause 17 Owner Must Identify the Land ..................................................... 20
Clause 18 Building Permit Fees .................................................................... 20
Clause 19 Planning Approvals and Building Permits ................................... 21
Clause 20 Insurance ...................................................................................... 22
SECTION D DURING WORK
Clause 21 Variations to Statutory Laws ........................................................ 23
Clause 22 Variations to State or Commonwealth Tax Laws......................... 24
Clause 23 Requested Variations ................................................................... 24
Clause 24 Effect of Variations ...................................................................... 25
Clause 25 Owner Must Provide Land Access ............................................... 25
Clause 26 Vehicular Site Access .................................................................. 25
Clause 27 Owner Must Not Direct Builder's Workers .................................. 25
Clause 28 Owner Must Arrange Lending Body Inspections ........................ 25
Clause 29 Builder to Claim Progress Payments ...................................... 25, 26
Clause 30 Owner Must Make Progress Payments ........................................ 26
Clause 31 Builder's Right to Agreed Damages ............................................. 26
Clause 32 Unfixed Materials on Site ............................................................ 26
Clause 33 Prime Cost Items and Provisional Sums ................................ 26, 27
Clause 34 Builder's Right to Extensions of Time ................................... 27, 28
Clause 35 Suspension of Work ..................................................................... 29
SECTION E COMPLETION OF WORKS
Clause 36 Final Inspection ............................................................................ 29
Clause 37 List of Defects and Final Payment .......................................... 29,30
Clause 38 Handover and Final Payment ....................................................... 30
Clause 39 Defects Within the 3 Month Period.............................................. 30
Clause 40 Owner's Claim for Agreed Damages ............................................ 31
Clause 41 Ending This Contract Under Bankruptcy or Liquidations ........... 31
Clause 42 Builder's Right to End This Contract ..................................... 31, 32
Clause 43 Owner's Right to End This Contract ...................................... 32, 33
Clause 44 Owner May Get Another Builder to Finish Work ........................ 33
Clause 45 Subcontracting.............................................................................. 33
Clause 46 No Waiver ....................................................................................... 33
Clause 47 Severance ..................................................................................... 33
SECTION F DISPUTES AND TRIBUNAL
Explanatory Notes ........................................................................ 33
ATTACHMENT 2 Directors' Guarantee ............................................................... 37, 38
© HIA VNHC October 2004 1 INITIALS ………./ ……….
PARTICULARS OF CONTRACT
THIS CONTRACT
IS BETWEEN:
NOTE
If the Owner is a company, a
Directors' Guarantee must be
signed before this Contract is
signed. See Attachment 2.
OWNER/S – Peter Thompson
Of
House number – 14A
Street – Runny Road
City / Suburb – Wantirna
State – V i c t o r i a
Postcode – 3152
Home Telephone – 0404042042
Business Telephone – 94562211
Mobile – 0404042042
Email –
[email protected] BUILDER Pasquale Garofalo
ACN 116 651 346 HIA Membership No. 912757
of 56 Barclay Road, Derrimut VIC, 3030
Telephone (03) 8390 1000 Fax (03) 8390 1001
Registered Building Practitioner
Residential - Unlimited
Reg. No. DB-U22873
THE BUILDING WORKS:
NOTE
These documents must be
signed and dated with the
Contract.
Single storey brick veneer dwelling with double lock up garage.
(Brief description) as set out in the Specifications and Plans.
The SPECIFICATIONS include 3 pages that were prepared and
supplied by AHB Australia Pty Ltd
here are 6 sheets of PLANS and they were prepared AND supplied by
AHB Australia Pty Ltd
There are N/A sheets in the ENGINEER'S DESIGN/S AND it/they,
was/were, prepared by to be advised.
for the BUILDER
LENDING DETAILS: The LENDING BODY is Westpac
of.............................................................................................. ......
.......................................................................................................
© HIA VNHC October 2004 2 INITIALS ………./ ……….
WARRANTY/
PROFESSIONAL
INDEMNITY INSURER
INSURER: Vero
Of Level 10, 15 William Street, Melbourne
Postcode 3000
Telephone 9245 8048 Fax 9245 8050
Name of Insured of the owner
1(a) Except for the Builder's interest in this Contract and the legal
requirement for it to be arranged in respect of the Building
Works, the Builder receives no benefits in relation to arranging
such insurance.
1(b) The Builder further confirms that such insurance may be
arranged with an insurer of the Owner's choice.
2 The cost to the Owner for this insurance is nil.
THE LAND
at ……………………………………………………………………..
The TITLE PARTICULARS are:
Volume No…….. Folio No………
Plan of Subdivision No: ……………
Covenants, Restrictions and/or Easements on the Land
.......................................................................................................
SIGNED OWNER/S
NOTES
Only sign this Contract when:
All the required Contract
Documents, including the
Specifications and the Plans,
are attached and signed; and
All the details in the Schedules
have been filled in.
SIGNED OWNER/S: PETER THOMSON
.............................................................................................. .........
.......................................................................................................
(If more than one owner, all must sign)
SIGNED WITNESS:......................................................................
Name..............................................................................................
Address ..........................................................................................
SIGNED BUILDER
NOTE
The Builder must give the
Owner a readily legible signed
copy of this Contract within 5
clear Days after it is signed
SIGNED BY OR ON BEHALF OF THE BUILDER:
Supreme Construction Pty Ltd
.............................................................................................. ........
.............................................................................................. .........
SIGNED WITNESS:......................................................................
Name........................................................................................... ...
Address ..........................................................................................
CONTRACT DATE
NOTE
Insert date when Contract is
signed by both parties.
DATE OF CONTRACT
/ /
© HIA VNHC October 2004 3 INITIALS ………./ ……….
1. Time for completion
- building period
(Clause 11)
NOTE
Building Works to be carried
out by the Owner or the Owner's
agent are as listed in Schedule 5.
SCHEDULE 1
220 Days excluding the following estimates for delays:
Inclement weather and the effects of inclement weather
20 days
Weekends, public holidays, rostered days off and other
foreseeable breaks in the continuity of the work
10 days
Other days that are reasonable having regard to the
nature of the Building Work 30 days over Christmas
The Builder has excluded from the Contract Price amounts payable
to third parties in relation to the Building Works. The work or things
listed below are not included in the Contract Price and the Builder's
reasonable estimates of the amounts payable in respect to them are
listed as follows:
Item Estimate
1 Conveying connection or installation of
(a) Gas N/C
(b) Electricity $220.00
(c) Telephone to one point N/C
(d) Water N/C
(e) Sewerage N/C
2 Issue of Planning Permit By owner
3 Issue of Building Permit Included
4 Other
(a) ................................................... $....................
(b) ................................................... $....................
2. Contract Price
(Clause 12)
Price excluding GST $181,045.45
GST on the above amount $18,104.55
Contract Price including GST $199,150.00
The Contract Price is GST inclusive.
© HIA VNHC October 2004 4 INITIALS ………./ ……….
The price of this Contract is not fixed, and may be altered as a result of:
additional costs caused by any deficiency or conflict within the Contract Documents (Refer to Clause 16);
additional building permit fees (Refer to Clause 18);
variations including those required by the council/registered building surveyor (Refer to Clause 21);
the cost of providing access where applicable (Refer to Clause 26);
interest on overdue payments (Refer to Clause 31); and
the actual cost of Prime Cost Items and work for which Provisional Sums have been specified exceeding
the estimates set out in the Contract (Refer to Clause 33).
Ensure that you fully understand how the clauses dealing with these matters affect the Contract Price.
WARNING TO OWNER AS TO PRIME COST ITEMS
It is always better to get a fixed price for all work. However, some fixtures and fittings may need to be selected
after the Contract is signed e.g. a stove, type of taps etc. If these items are specified as Prime Cost Items the
Builder will allow an amount in the Contract Price which should cover the expected cost of the item.
NOTE: If the actual cost is more than the amount allowed you will have to pay the extra amount. You may
also have to pay the Builder's margin in the extra amount. If this is intended, the margin should be
specified, or cannot be claimed unless the Owner agrees in writing to such additional amount. If the
Prime Cost is less than that allowed for in the Contract, the difference should be deducted from the
Contract Price.
3. Deposit
(Clause 9) $9,957.50........................................... 5% if Contract Price)
4. Person responsible for
obtaining and paying for
planning approval and
number of days to
obtain Building Permit
(Clause 19)
By owner
5. Person responsible for
obtaining and paying for
the Building Permit and
number of days to
obtain Building Permit
(Clause 19)
AHB Australia Pty Ltd
within 55 days of the builder receiving evidence of the Owner's title to
the Land and ability to pay under Clause 13.
6. Percentage if Contract
is ended
(Clauses 19.4 and 21.4)
25%
7. Number of Days to
make Progress
Payments after stage
completed and notice
received
(Clause 30)
7 days
© HIA VNHC October 2004 5 INITIALS ………./ ……….
8. Agreed interest for late
Progress Payments
(Clause 31)
18% per annum
9. Agreed damages for
late completion of the
Building Works
(Clause 40)
$250.00 per week
10. Percentage applicable
to extra work
(Clauses 12.2, 17.2 and 21.2)
25%
11. Lending Body Finance Westpac
Finance $328000 with approval
to be within 21 days
from the date of this Contract (14 days
unless otherwise agreed)
12. Agreed damages for
delays
(Clause 34.1)
$250.00 per week
© HIA VNHC October 2004 6 INITIALS ………./ ……….
SCHEDULE 2
PRIME COST AND PROVISIONAL SUM ITEMS
AND ALLOWANCES
Refer to procedures in Clauses 12 and 33
The parties agree that the following allowances are included in the Contract Price. The allowances included in
the Contract Price by the Builder for Prime Cost Items and Provisional Sums must be a reasonable estimate
of the price for the supply of the item and/or the work to be performed, in accordance with Sections 20, 21 and
22 of the Domestic Building Contracts Act 1995.
PRIME COST ITEMS FITTINGS, FIXTURES, MATERIALS ONLY
DETAILED DESCRIPTION OF THE ITEM
QTY
$ PER UNIT
$
ALLOWANCE
MARGIN ON
EXCESS
(if nothing stated 20%)
Please refer to contract estimate
PROVISIONAL SUM ITEMS LABOUR AND MATERIALS
DETAILED DESCRIPTION OF THE WORK QTY RATE $ ALLOWANCE
MARGIN ON
EXCESS
(if nothing stated 20%)
Please refer to contract estimate
© HIA VNHC October 2004 7 INITIALS ………./ ……….
SCHEDULE 3
CONSTRUCTION STAGES APPLICABLE TO METHOD 1 PROGRESS PAYMENTS
'Base stage' means (a) in the case of a home with a timber floor, the stage when the
concrete footings for the floor are poured and the base
brickwork is built to floor level;
(b) in the case of a home with a timber floor with no base
brickwork, the stage when the stumps, piers or columns are
completed;
(c) in the case of a home with a suspended concrete slab floor, the
stage when the concrete footings are poured;
(d) in the case of a home with a concrete floor, the stage when the
floor is completed; and
(e) in the case of a home for which the exterior walls and roof are
constructed before the floor is constructed, the stage when the
concrete footings are poured.
'Frame stage' means the stage when a home's frame is completed and approved by a
building surveyor.
'Lock-up stage' means the stage when a home's external wall cladding (Brick work only does
not included weatherboard or cement sheet in fills) and roof covering is
fixed, the flooring is laid and external doors and external windows are
fixed (even if those doors or windows are only temporary).
'Fixing stage' means the stage when all internal cladding, architraves, skirting, doors, baths,
basins, troughs, sinks, cabinets and cupboards of a home are fitted and
fixed in position.
'Completion' means the Building Works are complete in accordance with the
Contract Documents.
.NOTE
This table is prescribed by Section 40 of the Domestic Building Contracts Act 1995.
In the case of a Domestic Building Contract that is not listed in the Table, a Builder must not demand or receive
any amount or instalment that is not directly related to the progress of the Building Works being carried out
under the Contract.
TABLE
COLUMN 1 COLUMN 2 COLUMN 3
Type of Contract Percentage of Contract Price Stage
Contract to build to lock-up stage 20% Base stage
25% Frame stage
Contract to build to fixing stage 12% Base stage
18% Frame stage
40% Lock-up stage
Contract to build all stages 10% Base stage
15% Frame stage
35% Lock-up stage
25% Fixing stage
© HIA VNHC October 2004 8 INITIALS ………./ ……….
SCHEDULE 3 - METHOD 1
PROGRESS PAYMENTS NOTE
Use Method 1 unless the Building Works differ from the usual. If
Method 2 is to be used the Owner must read and sign Attachment 1 on
page 10. Delete whichever method is inapplicable.
Method 1
There are five stages in Method 1. These are described below. Fill in
the percentage of the Contract Price and the amount payable for each
of the stages applicable to your Contract (for example, if the Contract
is to build to lock-up stage, fill in only the first 3 stages and delete the
last 2 stages; if the Contract is to complete the Building Works
complete all 5 stages).
There are five different types of construction for the Base Stage - refer
to Schedule 3. In the space * provided below fill in (a), (b), (c), (d) or
(e) to indicate which type will be used under this Contract
METHOD 1
STAGE
PERCENTAGE OF
CONTRACT PRICE
AMOUNT
Deposit (Refer to Clause 9)
5%
$9,957.50
Base stage [
]*
10%
$19,915.00
Frame stage
15% $29,872.50
Lock-up stage
35% $69,702.50
Fixing stage
25% $49,787.50
Completion
10% $19,915.00
TOTAL CONTRACT PRICE
(Excluding Variations)
100%
(Including Deposit)
$199,150.00
© HIA VNHC October 2004 9 INITIALS............../..............
SCHEDULE 3 - METHOD 2
PROGRESS PAYMENTS NOTES
Under Method 2 the Builder and the Owner must agree on stages at
which Progress Payments must be made.
Remember, the Owner must read and sign Form 1 of the Regulations
(refer to Attachment 1 on page 10) before using Method 2.
The parties agree –
FORM 2 OF THE REGULATIONS
Regulation 6(b)
(i) that the Progress Payments fixed by section 40 of the Domestic Building Contracts Act 1995 do not apply;
and
(ii) that instead the percentage of the Contract Price and amounts payable are as follows:
NAME OF
STAGE
If this stage is not the same as a stage
defined in section 40(1) of the
Domestic Building Contracts Act
1995, what does this stage mean?
PERCENTAGE OF
TOTAL PRICE
AMOUNT
DEPOSIT
..............................................................
...............................%
$ ............................
...........................
..............................................................
...............................%
$ ............................
...........................
..............................................................
...............................%
$ ............................
...........................
..............................................................
...............................%
$ ............................
...........................
..............................................................
...............................%
$ ............................
...........................
..............................................................
...............................%
$ ............................
...........................
..............................................................
...............................%
$ ............................
...........................
..............................................................
.........................%
$ ............................
TOTAL CONTRACT PRICE
(Excluding Variations)
100%
(Including Deposit)
$ ...........................
© HIA VNHC October 2004 10 INITIALS............../..............
ATTACHMENT 1
FORM 1 OF THE REGULATIONS
Regulation 6(a)
WARNING TO OWNER - CHANGE OF LEGAL RIGHTS
Section 40 of the Domestic Building Contracts Act 1995 provides that a Builder cannot charge more than a
fixed percentage of the total Contract Price at the completion of each stage of building a home.
The Act also allows the parties to agree in writing to change the stages and the percentage of the Contract Price
to be paid at the completion of each stage.
There are several ways in which a particular Contract can vary from the normal, and it is these exceptional cases
which have caused the law to allow for these changes. Examples would include:
where it is very expensive to prepare the land for building, for example, where the site is steep or rocky;
where the house is so large that it will take a long time to complete, and intermediate Progress Payments
are therefore required;
where exceptionally expensive finishes are required, meaning that the final stage will represent a much
larger proportion of the whole price;
where an architect is engaged to independently assess the value of completed work for Progress Payments.
You should not agree to Progress Payments different from those provided in the Act unless your house is
unusual in some way and you are SURE THAT DIFFERENT PROGRESS PAYMENTS ARE
NECESSARY and you understand clearly why the change is needed in the case of your particular house. If you
have any doubts, you could contact:
Housing Industry Association
The Master Builders' Association of Victoria
Office of Fair Trading and Business Affairs
Royal Australian Institute of Architects
......................................Peter Thompson.............................................
I acknowledge that I have read this warning before signing the Contract.
Signature of Building Owner.
WHEN METHOD 2 IS TO BE USED FOR PROGRESS PAYMENTS
ALL OWNERS MUST SIGN
© HIA VNHC October 2004 11 INITIALS............../..............
SCHEDULE 4
SPECIAL CONDITIONS
1. In order to avoid any misunderstandings in regard to this contract, the following needs to be fully understood
in an effort to maintain a good relationship between the parties to this contract:
a. It is the policy of the Builder not to enter into any oral arrangements
b. The Building Owner must not rely on any oral representations concerning any part of the works as they
must be included in the documentation or they will not be recognized.
2. Both Parties acknowledge that the AHB Australia Tender Documents attached forms part of this contract.
3. The Builder reserves the right to amend the siting of the building works as described in this Building contract
subject to the provision of services, council requirements and developer requirements, which shall be at the
sole discretion of the Builder.
4. Location of meters and (if applicable) sub-access door: these items will be at the sole discretion of the
Builder unless otherwise directed by the Building Owner prior to preparation of all the documentation
Relating to this contract, however all this work must comply to the respective authorities requirements.
5. Whilst the Builder has agreed to provide the physical connection to water, storm water, sewer, gas and
power subject to mains being located within the property boundaries, easement or the footpath
immediately adjacent to the property, and in doing so pays the standard connection fee’s the Builder
does not agree to pay any consumer account opening fee’s or for the consumption of water, power or
gas during the construction process.
6. Rendering or Bagging: some rust stains may develop over a period of time to the tendered or bagged
surface, which is normally due to metal particles in the sand used in the mix. As this is beyond the
control of the Builder, it will therefore not be considered a defect.
7. Retaining Wall: In the event of a retaining wall being required, the Building Owner shall agree to have
the said wall completed prior to the completion for the Builder to obtain an Occupancy Permit.
8. The bricks may vary from time to time in colour and face, however the Builder will endeavour to keep any
variation to a minimum. The bricks must be accepted as delivered by the Brick Company, providing they
have been correctly ordered.
9. Painting: Two internal paint colours and two external paint colours are included in the contract price. Any
additional paint colours will incur an additional charge.
10. Colour of fixtures and fittings: colour may vary from time to time, for which the Builder will not be
responsible, provided they have been correctly ordered.
11. Please note that appliances do not get fitted off until Handover is completed. The reason for this is to
prevent theft of appliances between the completion of the works and the actual handover day. If the
Owner requires that appliances are to be installed prior to handover, then the Owners may request the
Builder in writing to install the appliances before handover. If...