How do I deal with the final payment - please advice

[Aulyna]

I am building a house, and received a Notice of Practical Completion from the builder. He is asking for the final payment, $7k, before he gives the keys.

The problem is I do not agree the construction is at “Practical Completion”. There are quite a few things which have not been done, such as
1. landscaping, with allowance of $7k
2. two water tanks
3. cloth lines
4....

The contract defines “Practical Completion” is when the Works are completed except for minor omissions and minor defects which do not prevent the Works from being reasonably fit for occupation or use by the Owner.

According to the contract, the house should be finished two month ago. As I feel the builder is a bit unreliable, I am worrying he gets all the money and walks away. In fact, the allowance for landscaping alone is more than the final payment he required. That is, the builder already got paid for what he has not done.

My questions are:
1. Is it at the stage of practical completed?
2. Who has the final say to decide if it is Practical Completion?
3. On the contract, a clause states if the house is built after the deadline, liquidation would be paid. How and when I can claim the liquidation? Before or after the final payment?

Any advice is welcome. Many thanks.

 

[Bigtone]

do not pay, once u do u have no power at all.

i can't stress it enough dont pay until u r happy

 

[Aulyna]

Thanks Bigtone for your kind reply.

There are people waiting to move in for $600/w, but I could not sign the lease, as i'm not sure when I can have the key ;-(

The contract says, $450/week paid from rent to builder if the house finished earlier or same amount money paid by the builder if the house build overtime. That would be about $2.5k paid by the builder with over 2month delay.

The builder said the landscaping will be done next week. if that's true, when i pay the final payment, should i pay the builder the full last payment to get the key first, and ask for the $2.5k later; or I should deduct the $2.5k from the payment?

Thanks for your advice

 

[Aulyna]

In addition to the problems above, I was astonished to find there is no shower (except the ones in ensuites)!

I had the house designed by an architect. Limited by the space, he suggested a shower above bath tub, therefore, he draw a small circle connecting to the bathtub head wall by a short line over the bathtub on the plan.

However, the builder argued he interpreted it as a waste position in the bath and wall spout. Furthermore, the builder said that this area is labelled BATH, not bath/shower. So he did not install the shower.

Can anybody please help
1. if this design is ambiguous?
2. if it is, should the builder talk to the designer to clarify it beforehand?
3. was the builder innocent?
4. what can I do to rectify it?

 

[tobe]

If you dont agree the house is at handover, you need to ask your building commissioner their opinion. The PCI inspection is just a point at which you can bring these sorts of issues up, and see if the builder agrees to rectify them. If that fails, you need to take it to mediation, which varies from state to state. In victoria the legal body is called the building commission.

I strongly advise you to get some legal advise, or at least go to the trouble of calling the building commission and get some information.

 

[Aulyna]

Thanks tobe,

Will contact the building commission. Hopefully, they can provide a fair justice. ; -)

 

[Pa1nter]

7K isn't a lot of money,if you make it difficult for the builder it could cost you a lot more than that in delays.

I would try and sort it out with out outsiders

I believe the missed shower was probably not the builders fault and perhaps the architect for not labeling the plans correctly.

 

[Belbo]

7K isn't a lot of money,if you make it difficult for the builder it could cost you a lot more than that in delays.

I would try and sort it out with out outsiders

I believe the missed shower was probably not the builders fault and perhaps the architect for not labeling the plans correctly.

Agree with all points made here by Pa1nter, but don't leave yourself open to the builder walking away. Avoid conflict, especially litigation, above all. You'll only be making lawyers rich! (Sorry Cu.)

Check over the documentation issued by the architect re the missing shower. His insurance might cover it if you can verify that he was instructed to include one but didn't update the specs and drawings accurately. If not, retrofitting a hose/wand type one though the bath taps could be an option to consider.

 

[Aulyna]

Thanks for all advice.

More problem to come:

Met the builder and his landscaper for landscaping yesterday morning.

There is a concrete area on the landscaping plan. but he said it could not be covered in the allowance. The quote is almost double the allowance.

Is it correct: builder give a low allowance, does not matter what on your plan?

Can I ask the landscaping allowance back and do the landscaping later?

Thanks for your help ;-)

 

[Pa1nter]

Is this on your original quote with the builder,if it was, isn't the problem between the builder and the landscaper and not yours?

I have seen this happen a few times lately but this is what a fixed contract is all about "FIXED"

 

[Aulyna]

Thanks, Pa1nter

The landscaping plan was attached with the contract, and there was a term of $7k landscaping allowance on the contract. I thought it should be the builder's problem. but the builder said the $7k could not cover this all ; -(

Which organisation or government agency can resolve the disputes? In another word, where can I get a fair resolution?

Thanks a lots ;-)

 

[Aulyna]

Finally the builder agreed refund the landscaping allowance and the final payment reduce to $100.

I want to pay it straight away and get the key, but the builder said he only hand over the key if i agree not charge the $5k+ Liquidated Damages.

I do not feel it is fair for me to bear the 3 month delay with no mistake made myself. Where can I get a quick ADJUDICATION? Thanks.

 

[Dazz]

Where can I get a quick ADJUDICATION?

Not anywhere in Australia - that's for damn sure.

 

[cu@thetop]

Not anywhere in Australia - that's for damn sure.

No so- I'm sure we can have a decision rushed through in 6-8 weeks

 

[lizzie]

So - at the end of the day:

you owe builder final payment of $7k

builder owes you $7k - plus $2.5k late fees - plus 2x water tanks - plus 1x clothesline installed - plus anything else not mentioned.

I wouldn't sign anything until at least the water tanks and clothes line are in ... might not be worth to fight over the $2.5k as equal to less than 5 weeks rent.

As for the shower over bath, I can understand why that wasn't clear - which is a reason to keep a very sharp eye on any developments you do (pop in every day if possible). As mentioned, a wall mounted hose shower would suffice, and you can get very nice stainless steel ones nowadays. Actually I like the hose showers as I can wash the dog in warm water in winter in the shower - not that you want tenants doing that!

 

[Aulyna]

Thanks for all replies.

lizzie: at the end, I give up the shower head, only own the builder $100.

I want to pay it straight away and get the key, but the builder said he only hand over the key if i agree not charge the $5k+ Liquidated Damages.

 

[murph14]

I want to pay it straight away and get the key, but the builder said he only hand over the key if i agree not charge the $5k+ Liquidated Damages.

Extortion alert

Go and see a lawyer and get some serious legal advice.

 

[Mick C]

I am building a house, and received a Notice of Practical Completion from the builder. He is asking for the final payment, $7k, before he gives the keys.

The problem is I do not agree the construction is at “Practical Completion”. There are quite a few things which have not been done, such as
1. landscaping, with allowance of $7k
2. two water tanks
3. cloth lines
4....

The contract defines “Practical Completion” is when the Works are completed except for minor omissions and minor defects which do not prevent the Works from being reasonably fit for occupation or use by the Owner.

According to the contract, the house should be finished two month ago. As I feel the builder is a bit unreliable, I am worrying he gets all the money and walks away. In fact, the allowance for landscaping alone is more than the final payment he required. That is, the builder already got paid for what he has not done.

My questions are:
1. Is it at the stage of practical completed?
2. Who has the final say to decide if it is Practical Completion?
3. On the contract, a clause states if the house is built after the deadline, liquidation would be paid. How and when I can claim the liquidation? Before or after the final payment?

Any advice is welcome. Many thanks.

I had a client who was in the same situation...
I wrote a letter to Department of fair trading on the clients behalf...gave it to the builder- 2 days later he came back and finished off the job


Nothing bets a tarnished record/ reputation. Who doesn;t check the Fair trading website on the builders license before building these days ?

Regards
Michael

 

[Aulyna]

Thanks for all replies.

At the end, go through a mediation with MBA. Agreed to have the builder pay $2k to me, which is about 1/3 of the liquidated damages.

Have not got the $2k yet, as the builder said his accountant was away, would pay next week ;-?) finally got the key handed over ^_^. Which is great, as people are waiting to sign the lease ;o)

Hopefully the 2k will be paid.

Again, thanks for all replies, very much appreciated

Aulyna