Commercial Contracts
Contract Advice for Contractors
Legislation applicable to building work that is not ‘domestic building work’ under Schedule 1B of the Queensland Building and Construction Commission Act 1991 (QBCC Act) is covered by Part 4A of the QBCC Act. The rules are different and it is important for the contractor to understand how Part 4A applies to their particular contract. Many of the provisions of a contract that do not align with the requirements of Part 4A are void and unenforceable to the extent of any inconsistency or conflict. Therefore, it is always best to ensure that the contract is drafted in a way that does not offend Part 4A so that the words of the contract apply in the manner in which the parties intend for them to apply.
Wood L&M Solutions can draft a contract that suits you and your business. We can also review proposed contracts given to you by the Principal for compliance and risk allocation.
Contract Advice for Clients
Legislation applicable to building work that is not ‘domestic building work’ under Schedule 1B of the Queensland Building and Construction Commission Act 1991 (QBCC Act) is covered by Part 4A of the QBCC Act. The rules are different and it is important for the client as the Principal to understand how Part 4A applies to their particular contract. Many of the provisions of a contract that do not align with the requirements of Part 4A are void and unenforceable to the extent of any inconsistency or conflict. Therefore, it is always best to ensure that the contract is drafted in a way that does not offend Part 4A so that the words of the contract apply in the manner in which the parties intend for them to apply.
Wood L&M Solutions can draft a contract that suits you and your project. We can also review proposed contracts given to you by the contractor for compliance and risk allocation.
Requirements of Part 4A of the QBCC Act
It is a requirement of Part 4A of the Queensland Building and Construction Commission Act 1991 (QBCC Act) for all contracts for building work (as defined in the QBCC Act) to be in writing. This carries a maximum fine of approximately $10k and 4 demerit points against the contractor’s licence. To be considered to be ‘in writing’, s67G of the QBCC Act requires the following matters to be in writing:
- name of the building contractor who will carry out the building work;
- licence number of the building contractor who will carry out the building work;
- address of the site;
- scope of the building work to be carried out;
- date for completion of the building work (or the way in which the date for completion will be determined e.g. within 20 business days of being given access to the site);
- whether retention / security applies to the contract (if not, then this must be noted); and
- contract price.
If the contract price is $10,000 or less (including GST), the above matters must be in writing before the building work is completed.
If the contract price is more than $10,000 (including GST), the above matters must be in writing before the building work is commenced.
If the contract price is initially $10,000 or less (including GST) and because of a variation, the contract price is revised to more than $10,000 (including GST), the above matters must be in writing prior to the commencement of the variation work.
The requirements of Part 4A of the QBCC Act do not apply to building contracts for work that is not ‘building work’ and/or if the value of the building work is less than $3,300 including GST (i.e. value of the work includes the cost of all labour, materials and GST regardless of who pays for the labour or materials).
Last updated: 30 December 2021