The short answer is yes. It is a legal requirement for a builder engaging in residential building work to enter into a written contract for the services he or she provides. The form of the contract will depend on the nature of the job and likely costs of the project. Failure to enter into a written contract as required by law could lead to potential prosecution and fines as it is an offence to undertake residential building work without a contract in place.
There is a growing trend in the industry whereby builders rely only on a quote or tender for building works and proceed on the basis that the quote or tender covers the relationship between the builder and customer. This is particularly prevalent in renovation, alternation, and addition projects. A quote would generally suffice where the costs of a project does not exceed $20,000. Where a project costs in excess of $20,000, a contract is a better way to go
A quote is likely to be brief and not cover keys areas of the agreement between the parties, such as the processes for variations, termination or extension of time which are the main culprits when it comes to building disputes. Where these issues are not properly addressed in an agreement for building work, the chances of a dispute taking place are increased and the resolution of that dispute could prove both complex and costly.
Written by Malik Anne.
