Which Type of Building Contract Should I Use?

Did you know there are many different types of building contracts that can be used for a building project?

Choosing the right building contract can save you a lot of money, time and stress.

We all know about the typical one, the lump sum or fixed price building contract. This is the traditional method used for project delivery over the past and presently but it is not the only one.

It may also be the wrong one for the project you are thinking of undertaking!

In total there are five (5) different forms of building contracts:

1. Lump Sum/Fixed Price (Traditional method);
2. Design and Construct;
3. Construction Management;
4. Project Management; and
5. Public Private Partnerships / Strategic Alliances

Each of these forms of "agreement" does different things, provides various opportunities and have differing risk profiles.

Subject to what it is you are intending to develop on your land, the time-frame you have to deliver it, your budget, and your in-house capabilities and resources to manage your project, you may wish to consider the varying advantages and disadvantages of each method of delivery.

In upcoming posts I will detail some information in relation to each of these forms of delivery for you to consider.

Visit the LEFTA website

Strata Dispute Involving A Marina

Ten years ago I was given a project recovery role on a waterfront property development involving luxury apartments, a large marina and some marine related commercial suites.

There was a complex strata plan due to all these competing uses which took substantial time to organize.

On top of this the By-Laws were purpose written to ensure all details were accounted for.

Now I understand that the marina owners are in dispute with the apartment and commercial suite owners regarding the allocation of costs for repairs, maintenance and operations.

Given we are talking about people with a reasonable asset backing and therefore some business acumen, it appears odd that the basis for the dispute would arise.

It seems that nobody has read the By-Laws or their original Contract For Sale of Land (or marina berth) where all the required information is contained. The entire process is clearly identified and everyone purchased their property on this basis.

This appears to be an unnecessary dispute that only feeds the lawyers pockets and clutters the courts.

For those who have raised the dispute it may end up being a very expensive exercise if they cannot prove their case.

If you become involved in any potential for dispute have a very close look at what you are going to argue about. Read the contract or agreement and try to settle the dispute promptly. If all else fails try mediation. If that fails then there is little other choice but litigation.

Litigation is very expensive and should be avoided wherever possible. What if you lost?

http://www.lefta.com.au

Property development - learning

I have just completed facilitating a 3 day advanced property development training course.

During the course a number of experts attended and spoke on their respective disciplines.

It always amazes me how many intelligent people there are in every facet of my industry.

But what's more impressive is the number of people that want to expand their knowledge base by attending these courses.

The continual pursuit of knowledge via deliberate learning is truly amazing!

By facilitating these courses I too learn both about my industry and about people.

The key point I make is that you should always seek professional expertise when you are not experienced at something. I do, and I've been in my industry for more than 30 years. I know when something is outside my core skill area.

Don't start a proposed development without appropriate advice; it could be very costly!!!

http://www.lefta.com.au

Building problem - builder designing home

I was asked today whether a home owner that engaged a builder to design, gain authority approvals and then to build their new home can stop the process once the design is finished and get someone else to finish it.

My answer? Depends! It all depends on what the contract says.

Let's assume the contract says you can terminate the contract at any stage as long as you have paid for their services up to that stage.

Can you get someone else to do it then? Answer? Depends!

So what does it depend on this time? Answer? The contract!

What does the contract say about Moral Rights, Intellectual Property Rights and Copyright?

OMG! You need to be a lawyer! Well that's not quite right, you only need one...

The point I'm trying to make is this, be very careful what you sign and make sure you understand what your obligations are (and the other entities obligations also).

If you are doing something that you are not experienced in, get help before you need help.

http://www.lefta.com.au