CPCCBC4003A – Select and prepare a construction contract

Appendix A: Project brief

Project title	Albif House
Project description	Mr. Kavi Albif and his wife have purchased a lot of land at 1040 Greenacre Boulevard, Northcote, VIC, 3070. The house is off the plan and there are no modifications to be made. Features: 4 bedrooms 1.5 bathrooms 3 living spaces Double garage Study
Estimate	$280,000 (subject to rise and fall)
Execution date	Contract signed: 31/03/17
Construction start date	03/04/17
Projected 50% completion date	17/07/17
Projected substantial completion date (95%)	16/10/17

Appendix B: Segments of contracts

Contract One

1. Definitions

1.1 In this Contract, unless the context otherwise requires, words and expressions used have the meaning defined or explained below:

(a) “Assessing Certifier” means the private certifier or Local Government Authority responsible for granting the relevant building approvals and authorisations for the Works.

(b) “Base Stage” means that stage when footings, base brickwork, base walls, stumps, piers, columns, formwork and reinforcing for a suspended slab, concrete slab, bearers, joists or flooring (as the case requires) have been completed ready for erection of the walls.

(c) “business day” means a day that is not:

(i) a Saturday or Sunday; or

(ii) a public holiday, special holiday, or bank holiday

(d) “Completion Period” means the Completion Period stated in Schedule Item 6.

(e) “Contract Price” means the total price of the Works stated in Schedule Item 1, including the Fixed Price Component and any allowances for Prime Cost Items and Provisional Sums, as adjusted under this Contract.

(f) “Contractor’s Authorised Representative” means the person identified on the first page of the Contract Schedule (or other person notified in writing to the Owner) as the person empowered by the Contractor to communicate with the Owner, including giving or receiving instructions as to variations.

(g) “Date for Practical Completion” means the date stated in or calculated by reference to Schedule

Item 7 or any extended date pursuant to this Contract.

(h) “Date of Commencement of Works on Site” means the date the Works commenced on Site as stated in the Commencement Notice issued by the Contractor.

(i) “Date of Practical Completion” means the date certified in the QBCC Form 7 – Certificate of Practical Completion in accordance with Condition 28.

(j) “Finance Date” means the date stated in Schedule Item 12 or, in the event no date is stated, the date 10 business days from the date of this Contract.

(k) GST” means any tax imposed by or through the GST Legislation on supply (without regard to any input tax credit).

(l) “GST Legislation” means A New Tax System (Goods and Services Tax) Act 1999 and any related tax imposition Act.

(m) “Practical Completion” means the date upon which the Works are completed in accordance with the requirements of this Contract, including Condition 3 and Condition 28, apart from minor omissions or minor defects.

(n) “Practical Completion Stage” means that stage of the Works in which Practical Completion will be attained in accordance with this Contract.

(o) “Prime Cost Item” means any item noted in the Prime Cost Items Schedule to this Contract and as contemplated by Conditions 4 and 19.

(p) “Provisional Sum” means any item noted in the Provisional Sums Schedule to this Contract and as contemplated by Conditions 4 and 19.

(q) “Starting Date” means whichever of the following dates occurs the latest:

(i) the Starting Date stated in Schedule Item 5; or

(ii) the day which is 10 business days after the issue of the plans duly approved by the Assessing Certifier; or

(iii) the day which is 10 business days after the Owner has satisfied its obligations under Condition 5.1.

“Substantial breach by the Contractor” has the meaning given in Condition 26.4. (aa)

“Substantial breach by the Owner” has the meaning given in Condition 26.3. (bb)

“work under this Contract” means all that work necessary to build the Works in accordance with the plans and specifications and this Contract, and, unless expressly excluded, includes:

(i) work to make the Site accessible to the Contractor

(ii) provision of any special equipment

(iii) work to clear the Site for building

(iv) set out of the Works and survey if necessary

(v) necessary structural retaining walls

(vi) sewerage, draining and electrical connections

(vii) provision of temporary water and power during construction

(viii) provision of clean up and disposal of waste material from the Site

2. Withdrawal during ‘cooling-off’ period

2.1 The Owner may withdraw from the Contract within the times noted below: (a) within 5 business days after the day on which the Owner receives from the Contractor a copy of both the signed Contract, including any plans and specifications, and the QBCC Consumer Building Guide; or (b) if the Contract is given to the Owner separately from the Consumer Building Guide, then within 5 business days after the day on which the Owner receives the second document.

2.2 Further, if the Contractor fails to give both the above documents to the Owner within 5 business days of the parties entering the Contract then, in addition, the Owner may withdraw at any time up until 5 business days after the day on which the Owner receives those documents in accordance with Condition 2.1 (a) or (b) above.

2.3 If the Owner wishes to withdraw relying on any of these circumstances, the Owner must give the Contractor a written notice stating that the Owner withdraws from the Contract under section 35 of Schedule 1B of the Queensland Building and Construction Commission Act 1991 (‘the QBCC Act’).

2.4 If the Owner withdraws from the Contract pursuant to this Condition, the Owner must pay to the Contractor the amount of $100 plus an amount equal to any out-of-pocket expenses reasonably incurred by the Contractor before the Owner withdrew from the Contract. If the Owner has already paid more than this amount at the time they withdraw, the Contractor must promptly refund the excess.

2.5 The Owner may not withdraw from the Contract under section 35 of Schedule 1B of the QBCC Act if: (a) the Owner and the Contractor had entered a previous Contract in substantially the same terms and relating to the same home or land; or (b) the Owner received formal legal advice about the Contract before entering into the Contract; or (c) the Owner, at the time of entering into the Contract or after entering into the Contract, tells the Contractor that the Owner had received formal legal advice about the Contract before entering into the Contract.

3. Warranties

3.1 The Contractor warrants that:

(a) the work under this Contract will be carried out in an appropriate and skilful way and with reasonable care and skill and reasonable diligence

(b) all materials supplied will be of good quality and suitable for the purpose for which they are used having regard to the Relevant Criteria, and that all materials used will be new unless this Contract expressly provides otherwise

(c) the work under this Contract will be carried out in accordance with all relevant laws and legal requirements including, for example, the Building Act 1975

(d) the work under this Contract will be carried out in accordance with the plans and specifications and any other Contract documents described in Schedule Item 15

(e) if the work under this Contract consists of the erection or construction of a detached dwelling to a stage suitable for occupation or is intended to renovate, alter, extend, improve or repair a home to a stage reasonably suitable for occupation, that the detached dwelling or home will be suitable for occupation when the Works are finished

(f) any estimate of Provisional Sums or Prime Cost Items included in the Contract has been calculated with reasonable care and skill, having regard to all the information reasonably available when the Contract is entered into (including information about the nature and location of the building site).

3.2 The Contractor must, unless the Contract expressly provides otherwise, supply at the Contractor’s cost and expense, everything necessary for the proper completion of the Works and for the performance of the work under this Contract.

3.3 The Owner must pay the Contractor the Contract Price for the Works in accordance with this Contract.

Contract Two

1. Definitions

Clause function: This clause defines terms used throughout this contract.

In this contract, the following definitions apply, unless the context requires a different meaning:

Act means the Domestic Building Contracts Act 1995.

Approval Work means the work necessary to apply for and obtain the building permits and any prescribed approvals for the Work but does not include applying for and obtaining an occupancy permit.

Builder means the person, partnership or company named in the Contract Details as the Builder and includes the Builder’s employees, agents, contractors, heirs, executors, administrators and permitted assignees and transferees.

Builder’s Representative means the natural person identified by the Builder in the Contract Details as authorised to communicate on behalf of the Builder with the Building Owner.

Building Owner means the person, partnership or company named in the Contract Details as the Building Owner and includes the Building Owner’s heirs, executors, administrators and permitted assignees and transferees.

Building Owner’s Representative means the natural person identified by the Building Owner in the Contract Details as authorised to communicate on behalf of the Building Owner with the Builder.

Building Site means the place where the Work is to be carried out and is described in the Contract Details.

Business Day means a day that is not:

• Saturday or Sunday
• a public holiday in Victoria (whether a whole day or part of a day).

Completion of Work means the time when the Work is complete in accordance with Clause 31.

Contract Details means the contract details set out in Clause 4.

Contract Price means the total amount payable under this contract and includes the amount:

• the Builder is to receive and retain under this contract
• the Builder is to receive under the contract for payment to any other person
• any third person is to receive (or is reasonably estimated to receive) directly from the Building Owner for:

• conveying to the Building Site or connecting or installing services such as gas, electricity, telephone, water and sewerage, or
• issuing planning and building permits.

The Contract Price does not include any amount that the Builder excludes in accordance with Clause 5.2.

Defect means:

• Work that is in breach of a warranty in Clause 17.1
• Work that is not of a standard or quality specified in this contract
• a failure to carry out and complete the Work in accordance with, and as required by, the plans and specifications and this contract.

Dispute Resolution Procedure means the dispute resolution procedure set out in Clause 34.

Domestic Building Dispute has the meaning given in section 54 of the Actreproduced in the Legislation Extracts.

Domestic Building Insurance means the insurance described in Clause 8.1.

Extension of Time means a period of postponement of the Finish Date.

Final Completion has the meaning in Clause 28.2.

Finish Date means the date stated in the Contract Details as the date when the Work will be finished. If no date is stated, Finish Date means the date calculated by adding the number of days stated in the Contract Details as being required to finish the Work to the date of commencement of Work set out in Clause 13.1.

Foundations Data has the meaning given in section 30(3) of the Actreproduced in the Legislation Extracts.

Inclement Weather means weather during which it is either not reasonable or not safe to continue the Work.

Legislation Extracts means the provisions set out in Part C headed ‘Legislation Extracts’, which form part of this contract.

Lender means a bank, building society or other financier that lends the Building Owner the Contract Price or any portion of that amount.

Loan Approval Date means the date in the Contract Details in Clause 4 that has been nominated by the Building Owner as the date by which the Building Owner expects a loan application for the purpose of the Work will be determined.

Opinion Procedure means the opinion procedure set out in Clause 32.

Penalty Interest Rate means the interest rate fixed from time to time under section 2 of the Penalty Interest Rates Act 1983.

Prime Cost Item has the meaning given in section 3 of the Act reproduced in the Legislation Extracts.

Provisional Sum has the meaning given in section 3 of the Act reproduced in the Legislation Extracts.

Variation means a variation according to law or Clause 23 of this contract (or both).

Work means the work required to be carried out under this contract, which is described in Clause 9.3 and described in more detail in the plans and specifications (which are attached to this contract). Work does not include Approval Work.

2. Interpretation

Clause function: This clause provides guidance about how the contract is to be interpreted.

2.1 In this contract, except where the context makes it clear that another meaning is intended, the following rules apply.

2.2 A word (or words) in italics and starting with a capital letter is a defined term for the purposes of this contract. This means it has the meaning outlined in Clause 1 (Note: Legislation is also italicised but should not be read as a defined term).

2.3 A reference to a ‘Clause’ is a reference to one of the numbered Clauses under Part B of this contract.

2.4 A reference to an ‘Attachment’ is a reference to one of the attachments to this contract (the Document List Attachment and the General Attachment).

2.5 A reference to a person in this contract includes a partnership or a company.

2.6 Words suggesting the singular include the plural and vice versa.

2.7 Headings, clause function notes and user notes in shaded text boxes are advisory notes only and must not be used to interpret this contract.

2.8 A reference to ‘include’ or ‘including’ or ‘for example’ in a list does not mean that items not listed are not included.

2.9 In the event of a conflict that cannot be resolved between the drawings and the relevant text, the meaning of the text will take precedence.

3. Communication between the Building Ownerand theBuilder

Clause function: This clause states how the parties to the contract will communicate with each other.

3.1 Communication between the parties for the purposes of this contract must be made between the Builder and the Building Owner or their appointed representatives nominated in Clause 4 in the Contract Details.

3.2 If the Building Owner communicates with the Builder’s Representative in a way that complies with this contract it means the same as having communicated with the Builder. Similarly, if the Builder communicates with the Building Owner’s Representative in a way that complies with this contract it means the same as having communicated with the Building Owner.

3.3 The Building Owner must not give directions to the Builder’s employees or sub-contractors except as provided in Clause 3.1.

3.4 The Building Owner can only rely on statements or representations as to any matter concerning the Work or its progress that are made by the Builder or the Builder’s Representative. The Builder can only rely on statements or representations as to any matter concerning the Work that are made by the Building Owner or the Building Owner’s Representative.

3.5 Wherever this contract requires the Building Owner or the Builder to make a demand or claim, serve a notice or document or communicate in connection with this contract, such demand, notice, document or other communication must be written in English and must be legible. As appropriate, such communication may be by the forms that are attached to this contract. Where a demand, claim notice, document or other communication is given in person, a written receipt should be given. Otherwise, all communications may be delivered by a method stated in the Contract Details (or to a subsequent address, if one is notified subsequently).

3.6 Receipt of service

Unless otherwise established by contrary evidence, a demand, claim, notice, document or other communication in connection with this contract is taken to be received at the following times:

a) If sent by post before 5.00pm on the day of posting:

i) The second day after posting, if posted to or from a place within the State of Victoria or an interstate capital city

ii) Five Business Days after posting, if posted to or from a place within another state within Australia other than a capital city

iii) 10 Business Days after posting, if posted to or from a place outside Australia

b) if delivered by hand, at the time of delivery, if delivered to the person or left at the person’s address nominated in Clause 4 with a person not less than 16 years of age and apparently residing or employed at that place

c) In the case of a facsimile if sent before 5.00pm on a Business Day, on the day it is sent and, if sent later in the day, on the next Business Day

d) In the case of electronic mail, if sent before 5.00pm on a Business Day, on the day it is sent and, if sent later in the day, on the next Business Day.

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