Building Contract Reviews in Queensland
Building contract reviews are not about rewriting the deal or slowing down the project.
They are about identifying legal and financial risks before they become locked in.
A proper review examines how the contract operates in practice, not just how it reads on the page, by testing payment structures, variation mechanisms, time controls, insurance compliance, and the interaction between the contract and Queensland’s statutory framework.
The table below outlines the key areas where building and construction lawyers add value in building contract reviews and how early legal scrutiny can prevent disputes, cost overruns, and enforceability problems once construction begins.
| Risk Area | What We Review | How We Help | Why It Matters |
|---|---|---|---|
| Contract Form & Structure | Base contract (HIA, Master Builders, QBCC) and all amendments | Identify non-compliant or one-sided clauses and explain their legal effect | Standard forms are not neutral and often favour builders |
| Scope & Specifications | Plans, specifications, inclusions, exclusions, schedules | Detect hidden scope gaps, vague descriptions, and risk-shifting wording | Unclear scope is the leading cause of disputes and cost blowouts |
| Payment & Cashflow | Deposits, progress claims, front-loading, retention | Ensure compliance with statutory caps and value-based payment rules | Non-compliant payments can be unenforceable or trigger disputes |
| Variations | Variation clauses, pricing methods, approval process | Ensure variations are properly controlled, priced, and documented | Informal variations often defeat payment rights or inflate costs |
| Prime Cost & Provisional Sums | Allowances, margins, adjustment formulas | Identify uncapped or misleading allowances and hidden escalation risk | Poorly drafted allowances convert fixed-price contracts into cost-plus |
| Time & Delay Risk | Completion dates, EOT clauses, notice requirements | Assess whether delay risk is unfairly shifted to the owner | Strict notice clauses can eliminate remedies if missed |
| Insurance & Licensing | QBCC licence, Home Warranty Insurance, certificates | Verify statutory compliance before any money is paid | Missing insurance or licensing exposes owners to major loss |
| Incorporated Documents | Specifications, quotes, annexures, special conditions | Review all documents forming part of the contract | Risk is often buried outside the main contract |
| Consumer Protections | Cooling-off rights, Consumer Building Guide, statutory warranties | Confirm protections apply and cannot be contracted out | These rights are lost if not properly triggered or preserved |
| Dispute Resolution | QBCC, QCAT, mediation, arbitration clauses | Ensure dispute pathways are lawful and workable | Invalid dispute clauses create delay and extra cost |
Building Contract Reviews
In relation to building contract reviews, domestic building contracts in Queensland are legally binding agreements that allocate risk, define payment structures, and set compliance obligations for residential construction.
These contracts are governed by strict legislation that mandates written form, deposit limits, progress payment rules, and enforceable warranties for workmanship and compliance.
While industry-standard templates are widely used, they often include hidden clauses that favour builders, creating financial and legal exposure for homeowners.
Key consumer protections—such as cooling-off rights, mandatory insurance, and variation protocols—override inconsistent contract terms, but only if properly implemented.
Most building disputes arise from preventable issues like unclear scope, uncapped allowances, and undocumented variations.
Conducting thorough pre-signing checks, such as verifying licences, insurance, documentation, and pricing integrity, along with reviewing all referenced schedules and annexures, is essential to ensure fairness, compliance, and to avoid costly civil litigation.
A domestic building contract is a legally binding agreement between a property owner and a licensed builder for the construction, renovation, alteration, or repair of residential premises.
In relation to building contract reviews, in Queensland, such contracts are governed by Schedule 1B of the Queensland Building and Construction Commission Act 1991 (Qld) (“QBCC Act”) and must be in writing.
In Vaiao & Anor v Sharkie [2019] QCAT 264, the Tribunal recognised that, as is unfortunately common, builders and owners often take a relaxed approach to forming their agreement for the building work. However, it is crucial that the contract clauses accurately reflect how the work will be carried out and that expectations are clearly set from the start. The Court stated at [2]:
As is unfortunately not uncommon, the parties adopted a somewhat relaxed approach to the formation of the agreement for the performance of the building work.
A lack of communication between the parties at the beginning can have serious consequences during construction.
Even a project that starts smoothly can end in termination if the terms are unclear or the contract is not properly reviewed to reflect the parties’ actual agreement.
The QBCC Act, together with the Australian Consumer Law, imposes mandatory consumer protections.
These include prescribed contract requirements, cooling-off rights, deposit limits, procedures for variations, rules for allowances and provisional sums, the right to issue invoices, and implied statutory warranties.
These provisions are reinforced by the Queensland Building and Construction Commission Regulation 2018 (Qld) and the mandatory Consumer Building Guide, which must accompany any contract valued at $20,000 or more.
The legislation recognises domestic building work as an area requiring stronger consumer safeguards, given the typical imbalance in bargaining power and technical knowledge between builders and homeowners.
Courts have recognised that residential owners rarely negotiate on equal footing and rely heavily on builder-supplied documentation.
In Perera v Bold Properties (QLD) Pty Ltd [2023] QDC 99, the court observed that domestic building contracts often contain standard form clauses drafted in the builder’s interests and accepted by consumers, which can or cannot bring a significant imbalance in the rights and obligations of the parties. The Court stated at [84]:
Special condition 7, as it is drafted, results in a significant imbalance of power between the parties. It provides the respondent with a unilateral right to vary the upfront price of the contract… without providing any right to the applicants to terminate or otherwise to negotiate the increase.
Under s 24(3) of the Australian Consumer Law, a term is transparent if it is:
- expressed in reasonably plain language; and
- legible; and
- presented clearly; and
- readily available to any party affected by the term.
Queensland tribunals have adopted similar reasoning when assessing the fairness and enforceability of standard terms.
In relation to building contract reviews, it is important to note that a lack of transparency, by itself, does not establish that a term is unfair.
The applicants must show that this lack of transparency contributed to a significant imbalance in the parties’ rights and obligations and would cause a detriment if relied on.
Contractual provisions must strictly comply with the formal requirements of the QBCC Act, as non-compliance can render certain clauses void or unenforceable.
It is a common misconception that “standard form” contracts, such as those issued by the HIA or Master Builders Queensland, are inherently fair or balanced.
In reality, these documents are industry-drafted templates rather than neutral legislative instruments.
A common practice among builders is to insert “special conditions” that modify key risk allocations relating to time, cost, and liability.
In relation to building contract reviews, clauses that shift delay risk, limit liquidated damages, or expand the builder’s rights to claim variations are frequently used and have been closely examined by the courts.
If these risks are not properly allocated or clearly expressed, disputes often arise, homeowners may refuse to pay, and builders may not be compensated for work that was fair in substance but poorly communicated or documented from the outset.
In Brett & Anor v Manson v Manson Homes [2020] QCATA 122, the Tribunal reiterated that fairness turns on the proper allocation of risk, clear communication, and compliance with contractual obligations. The Court stated at [32]:
…we are too, focused on acceptance of the respondent’s work and not merely whether he was in breach.
The same logic applies in the commercial context that standard wording provides no guarantee of equity.
One of the most important clauses, apart from the liability period, which we will discuss later in this article, relates to payment as it sets out the fixed percentage amounts for each stage of work, along with amounts calculated as variations and allocated as provisional sums.
Invoices for building work must comply with the payment percentages applicable to the specific contract type and payment method selected, which is usually determined by the builder based on the nature of the work.
For example, a standard Master Builders contract provides three payment method options, and these must align with your bank’s requirements if you need financial approval; otherwise, you will face difficulty with payment approval.
Division 1, Part 2, Section 13 of the Act sets out the general requirements for building contracts, while Division 2 outlines the requirements for payments under those contracts. Failure to comply with these provisions may result in serious legal consequences.
In relation to building contract reviews, it is essential that the contract type accurately reflects the work to be performed by the contractor. In the QBCC Act, depending on the type of contract, the building contractor under a regulated contract must not, before starting to provide the contracted services at the building site, demand or receive a deposit under the contract of more than:
- for a level 1 regulated contract (other than a contract mentioned in paragraph (c) ) – 10% of the contract price; or
- for a level 2 regulated contract (other than a contract mentioned in paragraph (c) ) – 5% of the contract price; or
- for a level 1 or 2 regulated contract under which the value of the off-site work is more than 50% of the contract price – 20% of the contract price.
As noted earlier, the estimated cost outlined in the contract’s scope of work is subject to variations, whether requested by the owner or proposed by the builder.
These variations affect the contract price and must be made in writing in accordance with the Act.
If the contractor ignores these rules, it may constitute an offence and could render its payment claims unenforceable.
In Partington v Urquhart (No 2) [2018] QCATA 120 and Mann v Paterson Constructions Pty Ltd (2019) 373 ALR 1; [2019] HCA 32, the Tribunal and Court emphasised that restitution (quantum meruit) may still apply where the homeowner accepted or benefited from the builder’s work.
However, until you obtain a decision in your favour, as the builder or homeowner, you would have incurred thousands of dollars in legal fees. The Court stated at [14]:
The quasi-contractual obligation to pay fair and just compensation for a benefit which has been accepted will only arise in a case where there is no applicable genuine agreement or where such an agreement is frustrated, avoided or unenforceable.
These statutory obligations sit alongside the Building Industry Fairness (Security of Payment) Act 2017 (Qld), which governs payment claims and adjudication procedures but does not override consumer protections under the QBCC Act.
This complete guide to building contract reviews addresses three distinct owner profiles with differing exposure to contractual and statutory risk.
Resident homeowners are protected most directly by consumer provisions and the Queensland Home Warranty Scheme, which provides insurance for defective or incomplete work.
Although the Building Industry Fairness (Security of Payment) Act 2017 (Qld), does not generally impose payment-claim obligations on residential owners, investors and non-resident owners may still be affected indirectly by strict statutory timeframes applying to contractors and subcontractors engaged on the project.
Failure to comply can result in liability for disputed sums regardless of performance defects, as illustrated in McNab Developments (Qld) Pty Ltd v MAK Construction Services Pty Ltd & Ors [2014] QCA 232. The Court stated at [51]:
…the only issue here is what is presently payable. In determining what is presently payable, I will, of course, give full consideration to any deductions the respondent claims to be entitled to make. However, that is no reason not to consider the merits of each of the individual claims.
Clauses creating charges or personal guarantees over fund assets may breach the sole-purpose test or constitute a prohibited borrowing arrangement, exposing trustees to civil and regulatory penalties.
In relation to building contract reviews, understanding these overlapping statutory regimes and the judicial emphasis on compliance and fairness is essential.
Queensland Legal Construction Framework
In relation to building contract reviews, a domestic building contract is not merely a formality but a regulatory instrument that defines risk allocation, payment structures, and enforcement mechanisms.
Treating it as a mere template or assuming its fairness invites statutory non-compliance and could expose you to litigation.
The domestic building contract regime in Queensland is controlled primarily by the Queensland Building and Construction Commission Act 1991 (Qld) (“QBCC Act”) and the Queensland Building and Construction Commission Regulation 2018 (Qld).
Schedule 1B of the QBCC Act establishes a comprehensive statutory framework governing domestic building work, imposing formal, financial, and procedural requirements that override inconsistent contractual provisions.
Schedule 1B – Domestic Building Contracts
Schedule 1B, section 13, prescribes mandatory elements that must be contained within every regulated domestic building contract.
Section 18 requires the builder to provide the Consumer Building Guide to the owner before the contract is signed for projects valued at $20,000 or more.
Section 19 provides that all variations must be in writing and signed by both parties before the additional work is performed.
Section 33 restricts deposits to a maximum of 10% for work valued under $20,000 and 5% for work valued at or above $20,000, unless a higher deposit is justified by substantial off-site work.
Section 34 of Schedule 1B regulates the structure of progress payments under regulated domestic building contracts, and, together with s 40, prevents builders from claiming progress payments that are inconsistent with the agreed stages or the actual value of work performed.
The cooling-off period is generally 5 business days from the date the owner receives the signed contract and the Consumer Building Guide. If the owner withdraws, the builder may be entitled to limited amounts (for example, QBCC guidance commonly refers to $100 plus reasonable out-of-pocket expenses).
Section 40: Any oral variation is unenforceable unless later reduced to writing and signed.
In Northbuild Construction Pty Ltd v Central Interior Linings Pty Ltd [2011] QCA 22, the Queensland Court of Appeal confirmed that payment entitlements under the security of payment regime depend strictly on compliance with contractual terms and statutory conditions. The Court stated at [57-58]:
If a claimant serves a payment claim on a respondent and the respondent does not serve a payment schedule within the earlier of the time required by the construction contract or 10 business days after receipt of the payment claim, the respondent becomes liable to pay the claimed amount to the claimant on the due date for the progress payment.
The Court emphasised that equitable doctrines cannot be invoked to bypass the limitations imposed by the Payments Act, reinforcing the primacy of statutory compliance over notions of fairness or unjust enrichment.
Schedule 1B implies non-excludable statutory warranties into every regulated domestic building contract, including warranties as to care and skill, compliance with plans and laws, suitability for occupation, and completion within a reasonable time.
These warranties are non-excludable and extend to successors in title for six years and six months from completion.
In Brirek Industries Pty Ltd v McKenzie Group Consulting (Vic) Pty Ltd [2014] VSCA 165, the Court of Appeal confirmed that documents incorporated by reference form part of the operative contractual framework, such that obligations contained in specifications or ancillary documents are enforceable notwithstanding that they do not appear in the main body of the contract. The Court stated at [114]:
The task is to construe the agreement by reference to the whole of the contractual context, including the documents and instruments which give it content.
Building Contract Reviews – Consumer Building Guide
In relation to building contract reviews, the Consumer Building Guide is a mandatory disclosure document produced by the Queensland Building and Construction Commission.
Delivery of the Consumer Building Guide is a mandatory statutory requirement, and non-compliance may suspend or defeat a builder’s ability to rely on contractual rights and time limits.
It outlines the owner’s statutory rights and time-critical obligations, including the cooling-off period, deposit limits, dispute resolution through the QBCC, and the requirement for Home Warranty Insurance (HWI) before commencement.
Non-compliance with mandatory statutory disclosure requirements may prevent a builder from relying on contractual waivers or truncating consumer protection periods.
In Freedom Homes Pty Ltd v Botros [1999] QCA 150, the Queensland Court of Appeal confirmed that contractual rights which depend upon compliance with statutory preconditions cannot be enforced where those preconditions are not met, reinforcing that statutory consumer protections operate independently of contractual drafting. The Court stated at [14]:
There is nothing in the legislation that provides that a registered builder who contravenes its terms is nevertheless entitled to enforce contractual rights which depend upon compliance with those terms.
Accordingly, where required documents are not provided before execution, a builder cannot rely on a purported waiver to defeat statutory rights arising from that non-compliance.
Queensland Home Warranty Insurance Scheme
Part 5 of the QBCC Act establishes the Home Warranty Insurance Scheme (HWI), a statutory insurance program that provides protection for defective or incomplete residential construction work with a value exceeding $3,300.
The builder must pay the insurance premium before work begins and provide the owner with a Notice of Cover within two weeks of payment.
Cover applies for non-completion, structural defects (six years and six months), and non-structural defects (generally 6 months from completion, subject to claim timing rules).
In Mahony v Queensland Building Services Authority [2013] QCA 323, the Queensland Court of Appeal confirmed that compliance with the statutory insurance regime is a strict obligation imposed on builders. The Court stated at [7]:
A building contractor must pay the appropriate insurance premium to the authority before commencing residential construction work; upon acceptance of the premium the authority is to issue a certificate of insurance… and a policy of insurance comes into force for the benefit of the consumer.
In relation to building contract reviews, while a failure to comply may affect the availability of insurance cover, it does not extinguish the homeowner’s rights against the builder, who remains liable for breach of statutory obligations imposed under the QBCC legislative scheme.
Building Industry Fairness (Security of Payment) Act 2017 (Qld)
The Building Industry Fairness (Security of Payment) Act 2017 (Qld) (“BIF Act”) operates in parallel with the QBCC Act, ensuring that builders and subcontractors are paid promptly for construction work.
Under Part 3, a claimant may issue a payment claim, and the respondent must serve a payment schedule within the statutory timeframe, typically 15 business days.
Failure to respond converts the claimed amount into a statutory debt recoverable through summary judgment.
The strict timelines were examined in McNab Developments (Qld) Pty Ltd v MAK Construction Services Pty Ltd & Ors [2014] QCA 232, where the Supreme Court of Queensland held that compliance with notice requirements is mandatory and that procedural default results in automatic liability for the claimed amount, regardless of underlying disputes. The Court stated at [69]:
Where a contractor has failed to deliver a payment schedule in time, it is precluded from making submissions to the adjudicator…
For non-resident owners or investors, these timeframes impose significant administrative risk.
Failure to manage payment schedule deadlines within the contracting chain may expose owners to indirect enforcement risk, including cash-flow disruption, project delay, or downstream recovery action, even where performance defects are alleged.
In relation to building contract reviews, the interplay between the BIF Act and the QBCC Act, therefore, requires strict compliance with statutory notices, service methods, and calendar deadlines.
Collectively, these instruments form a mandatory compliance matrix: Schedule 1B regulates contract form and consumer protection; the Consumer Building Guide and HWI ensure pre-contractual transparency and post-completion security; and the BIF Act enforces payment discipline throughout the construction lifecycle.
Queensland law treats these frameworks as cumulative, not elective, and courts consistently interpret them as consumer-protection mechanisms rather than commercial formalities.
Read more about making BIFA payment claims here – Making a Payment Claim – BIFA (QLD)
Pre-Signing Due Diligence (Preventable Mistakes)
In relation to building contract reviews, pre-signing due diligence is the decisive control point for a homeowner or investor before legal and financial exposure crystallises.
Most domestic building contract disputes originate not from poor workmanship but from preventable failures to verify, document, and understand the pre-contract position.
Queensland law embeds specific compliance steps under the Queensland Building and Construction Commission Act 1991 (Qld) (“QBCC Act”) and its Regulation to mitigate this risk.
Licensing and History Verification
Carrying out building work without the required QBCC licence is prohibited. An unlicensed contractor’s ability to recover payment is severely restricted and may be limited to a statutory entitlement in certain circumstances rather than full contractual enforcement.
A prudent owner must conduct a licence search through the Queensland Building and Construction Commission database to confirm licence class, scope, and expiry.
The builder’s disciplinary history, outstanding directions to rectify, and adjudication records are material indicators of risk.
Certification professionals involved in design or inspection should likewise be verified as currently accredited to prevent later exposure to defects liability.
Standard Forms and Hidden Amendments
Standard form contracts issued by industry bodies, including HIA, Master Builders, and QBCC, are not statutory instruments and do not confer a presumption of fairness.
They are builder-oriented templates that can be modified through annexures or special conditions.
Courts routinely treat “special conditions” as integral terms of the contract even when embedded in specifications or attached quotes, as confirmed in Brirek Industries Pty Ltd v McKenzie Group Consulting (Vic) Pty Ltd [2014] VSCA 165. The Court stated at [15]:
There were terms of the building surveyor agreement… which were to be implied by operation of law, and which arose from the contractual framework created by the documentation and the statutory context in which it operated.
In relation to building contract reviews, any document referenced in or attached to the contract, including plans, specifications, tender clarifications, and inclusion schedules, forms part of the binding agreement and should be reviewed for exclusions, provisional sums, or discretionary builder powers.
Cooling-Off Period
Section 35 of Schedule 1B provides a statutory five-business-day cooling-off period for the owner to terminate upon receipt of a signed copy of the contract and the mandatory Consumer Building Guide.
The builder may deduct only prescribed administrative costs, not exceeding 0.5% of the contract price.
The period does not apply if the owner obtained independent legal advice before signing, or if the owner has previously entered into a substantially similar contract for the same work.
Deposit Restrictions
Statutory deposit caps under s 33 of Schedule 1B are non-negotiable: a maximum of 10% for work under $20,000 and 5% for work valued at $20,000 or more, unless significant off-site fabrication justifies a higher figure.
When conducting building contract reviews, excessive deposits constitute offences under the QBCC Act and may render the contract ineffective to the extent of the inconsistency.
Home Warranty Insurance
For domestic building work exceeding $3,300, Part 5 of the QBCC Act mandates that the builder obtain and pay for Home Warranty Insurance before work commences.
The builder must provide the owner with a Notice of Cover within 14 days of premium payment.
The policy protects against non-completion, defective work, and subsidence.
Failure to secure insurance constitutes a breach of statutory duty and may expose the builder to prosecution.
When conducting building contract reviews, owners should require payment evidence before releasing any deposit.
In summary, rigorous pre-signing verification, licence status, form amendments, statutory disclosures, insurance compliance, and alignment of financial structures prevent statutory breaches and eliminate the most common triggers of residential construction litigation in Queensland.
| Item Reviewed | What We Check | Risk if Missed |
|---|---|---|
| Builder’s QBCC Licence | Licence class, scope, currency, disciplinary history | Unenforceable contract or limited recovery |
| Home Warranty Insurance | Premium paid, Notice of Cover issued | Loss of insurance protection |
| Consumer Building Guide | Correct version provided at the right time | Extended cooling-off and loss of builder rights |
| Contract Form Selection | Whether the contract type matches the work | Statutory non-compliance |
| Deposit Structure | Compliance with statutory caps | Offences and unenforceable payments |
| Progress Payments | Alignment with construction stages | Front-loaded or unlawful claims |
| Variations Process | Written approval and pricing method | Loss of payment rights or disputes |
| PC & PS Allowances | Caps, margins, and definitions | Cost escalation |
| Special Conditions | Hidden risk-shifting clauses | Unfair or unenforceable terms |
| Document Precedence | Clear hierarchy of documents | Builder exploiting secondary documents |
The Documents Package (What You Must Have Before Signing)
When conducting building contract reviews, before execution of a domestic building contract, the entire documentation package must be assembled, verified, and cross-referenced.
Queensland law treats every incorporated or referenced document as part of the binding agreement.
Courts and tribunals have consistently held that attachments, annexures, and referenced materials carry equal contractual force, even when not physically appended.
In Brirek Industries Pty Ltd v McKenzie Group Consulting (Vic) Pty Ltd [2014] VSCA 165, the Court of Appeal confirmed that documents expressly or impliedly incorporated into the contractual framework form part of the operative terms of the contract, reinforcing that risk allocation may occur through specifications, permits and ancillary documentation rather than solely within the main body of the contract. The court stated at [15]:
There were terms of the building surveyor agreement, amongst others, as follows… the terms were to be implied by operation of law.
Core Documentation Requirements
The minimum package required for compliance and risk control includes:
- Final architectural and engineering plans signed and dated. Draft or “for construction” versions are insufficient. Plans establish the scope and quality of deliverables and control the precedence of documents.
- Specifications, detailing materials, workmanship standards, and finishes. Under s 42 of Schedule 1B to the Queensland Building and Construction Commission Act 1991 (Qld) (“QBCC Act”), the builder is bound by statutory warranties that work will be carried out in accordance with these specifications and with due care and skill.
- Inclusions and exclusions schedule, clarifying exactly what is priced and what is omitted, any uncertainty in specification or inclusion is construed contra proferentem against the builder.
- Engineering, geotechnical, and soil classification reports, forming the technical baseline for structural design and footing selection. Section 30 of the Building Regulation 2021 (Qld) requires foundation data to meet AS 2870 standards; deviations expose the builder to liability under the statutory warranties of fitness and compliance.
- Selections and finishes schedule, identifying appliances, fixtures, and finishes by brand, model, or code to eliminate ambiguity and avoid substitution disputes.
- Services and connection assumptions, covering water, sewer, stormwater, electricity, NBN, and gas availability. Clauses transferring responsibility for unforeseen connection costs must be identified and quantified prior to signing.
- Approvals responsibility matrix, allocating obligations for planning approval, building approval, and certification. The Planning Act 2016 (Qld) contains provisions for carrying out assessable development without a required development permit.
- Clean, builder-amended conditions set, showing all handwritten or electronic amendments against the base form (HIA, Master Builders, or QBCC). Untracked amendments are high-risk indicators; courts infer deliberate concealment when alterations are undisclosed or inconsistent with statutory consumer protections.
Hidden Conditions and Integration Risk
Specifications, quotations, and ancillary schedules are the preferred vehicles for shifting risk from builder to owner.
Variations clauses, delay allowances, escalation formulas, and limitation-of-liability provisions are frequently embedded in these documents under headings such as “Assumptions,” “Clarifications,” or “Builder’s Notes.”
When conducting building contract reviews, it is important to remember that ancillary documents are not peripheral; they directly influence statutory compliance and consumer entitlements.
Statutory Context
Section 14 of Schedule 1B mandates that contracts for domestic building work exceeding $20,000 must be in writing, signed, and accompanied by the Consumer Building Guide.
The statutory formality extends to every document forming part of the contract.
Section 19 requires written, signed approval for any variation to plans or specifications before any additional work commences; failure to do so voids any right to recover costs.
Under Schedule 1B of the Queensland Building and Construction Commission Act 1991 (Qld), variations to regulated domestic building work must be documented in writing and agreed before the work is carried out.
Queensland tribunals have consistently held that non-compliance with these statutory requirements disentitles a builder to recover payment for variation work, even where the owner has benefited from that work.
Contract Assembly Integrity
All drawings, reports, and schedules must be collated into a single, referenced package with a document register listing version numbers, dates, and authorship.
Each item should be explicitly identified in the contract schedule to prevent disputes over document precedence.
Builders often attempt to include a clause giving precedence to the specification over the drawings or to “builder’s clarifications” over the main contract.
These clauses transfer interpretive control and should be redlined prior to execution.
Risk Concentration
Unverified attachments conceal most owner-side risk.
They are used to dilute obligations, expand provisional sums, and justify cost escalation.
Schedule 1B assumes that builders bear primary responsibility for clarity and compliance, and owners should not be taken to have accepted hidden risk merely because it was embedded in ancillary documents.
When conducting building contract reviews, the pre-signing collation of the complete document set, therefore, functions not as an administrative exercise but as the decisive legal safeguard ensuring enforceability, compliance, and control of contractual risk.
Key Commercial Levers to Negotiate (Clause-by-Clause)
The contractual levers governing domestic building projects in Queensland govern how risk, cost, and responsibility are allocated between the owner and the builder.
A compliant contract must define the project scope with measurable precision and establish clear document precedence to prevent builders from exploiting secondary documents or ambiguous specifications.
The Queensland Building and Construction Commission Act 1991 (Qld) imposes mandatory warranties for workmanship, materials, and timeliness, reinforced through cases such as Brirek Industries Pty Ltd v McKenzie Group Consulting (Vic) Pty Ltd [2014] VSCA 165. The court stated at [15]:
There were terms of the building surveyor agreement, amongst others, as follows:
(a) the defendant and its agents, representatives and employees would exercise all due care, skill and diligence in providing the building surveying services to the plaintiff;
(b) the defendant and its agents, representatives and employees would comply with its statutory duties and obligations pursuant to the Building Act 1993 and the Building Regulations 1994.
Pricing mechanisms require strict control; cost-plus contracts are prohibited under s 55 of the Act unless expressly exempted; and allowances, such as Prime Cost and Provisional Sums, must be capped and transparent.
Cashflow regulation under ss 13 and 40 of Sch 1B restricts deposits and requires progress payments to match work performed.
Time management relies on explicit extension-of-time procedures and proportionate liquidated damages.
Variation clauses must comply with s 19; only written, signed variations are enforceable, while completion obligations are tested against objective fitness-for-occupation standards.
Dispute provisions should channel conflicts through notice, negotiation, and mediation before litigation, consistent with QCAT’s jurisdiction under s 77 of the Queensland Civil and Administrative Tribunal Act 2009 (Qld) and the procedural objective of r 5 of the Uniform Civil Procedure Rules 1999 (Qld).
When conducting building contract reviews, collectively, these clauses convert legislative mandates into enforceable safeguards, determining whether the agreement functions as a controlled-risk instrument or as a future source of litigation.
Scope, Quality and Precedence
The foundation of a domestic building contract lies in the precision of its defined scope.
The Queensland Building and Construction Commission Act 1991 (Qld) (“QBCC Act”) implies statutory warranties into regulated domestic building contracts (including warranties about standard of work, care and skill, compliance with laws, adherence to plans/specifications, suitability for occupation, and related matters).
To mitigate ambiguity, the scope must be expressed in measurable outcomes, dimensions, finishes, tolerances, and material specifications, to prevent interpretation in favour of the drafting party.
The precedence clause must identify the hierarchy among contract documents, including the main body, special conditions, specifications, drawings and quotations.
Failure to define precedence allows builders to rely on secondary documents to justify reduced obligations.
In Brirek Industries Pty Ltd v McKenzie Group Consulting (Vic) Pty Ltd [2014] VSCA 165, the Court of Appeal confirmed that contractual obligations arise from the whole contractual framework, including documents incorporated by reference, reinforcing the need for clear precedence ordering to avoid unintended risk allocation. The Court stated at [15]:
There were terms of the building surveyor agreement, amongst others, as follows… the terms were to be implied by operation of law.
In Built Qld Pty Limited v Pro-Invest Australian Hospitality Opportunity (ST) Pty Ltd [2022] QCA 266, the Court said:
Clause 8.1(a)(ii) of the contract then provided for an order of precedence including that ‘the clarifications have precedence over the preliminary design’ … The contract contained little meaningful definition about the alternative air conditioning system which the appellant contracted to provide.
Price and Cost Risk
When conducting building contract reviews, the contract’s pricing mechanism determines financial exposure.
The QBCC warns against “cost-plus” contracts for domestic work unless the scope cannot reasonably be defined.
Section 55 of the QBCC Act prohibits cost-plus arrangements for regulated domestic work unless a valid written exemption applies.
Breach renders the contract of no effect to the extent of the inconsistency, and may prevent recovery of costs.
Fixed-price contracts provide predictability, but risk re-emerges through Prime Cost (PC) items and Provisional Sums (PS).
These allowances should be narrowly defined and minimised, as builders frequently understate them to reduce the quoted price and later issue variations to recover costs.
Courts construe PC and PS adjustments strictly: in Sopov v Kane Constructions Pty Ltd (No 2) [2009] VSCA 141, cost escalation was disallowed because the builder failed to demonstrate compliance with contractual pricing methodology. The Court stated at [29-30]:
Her Honour was fully entitled to approach the assessment of the value of the works… by requiring Kane Constructions to prove: (a) the total costs incurred and payments made by it… and (b) that the amounts in question were fair and reasonable in the circumstances.
Any builder’s margin on changes must be stated numerically, and any price-escalation mechanism must specify objective triggers, such as changes in government levies or shifts in material indices.
Clauses granting unilateral discretion to adjust prices breach s 42(1) of Sch 1B, which requires fairness and transparency in domestic contracting.
Payments, Security and Cashflow
Section 33 of Sch 1B limits deposits to 10% for contracts under $20,000 and 5% for contracts of $20,000 or more, except where significant off-site fabrication justifies a higher figure.
Progress payments under s 40 must correspond to the actual value of work completed and stated stages in the contract.
Builders may not claim payment inconsistent with the completion levels.
Retention or defects security should be defined as a percentage and capped, and must only be applied against verified defects or incomplete work in accordance with the contract and Schedule 1B.
Interest and set-off clauses require symmetry; unilateral interest provisions are often struck out as penalties.
The Building Industry Fairness (Security of Payment) Act 2017 (Qld) operates concurrently, prescribing timeframes for payment claims and schedules.
Failure to respond within the statutory period results in the respondent being precluded from resisting the claim, rendering the claimed amount recoverable as a statutory payment obligation, as confirmed in McNab Developments (Qld) Pty Ltd v MAK Construction Services Pty Ltd & Ors [2014] QCA 232. The Court stated at [69]:
Where the contractor has failed to deliver a payment schedule in time, it is precluded from making submissions to the adjudicator.
Time, Delay and Extensions of Time (EOTs)
Commencement and completion dates anchor the builder’s obligation to deliver within a defined timeframe.
Section 42(3) of Sch 1B implies a warranty that work will be completed within the agreed or reasonable period.
EOT clauses must identify qualifying causes (e.g., inclement weather, owner delay, industrial action) and impose strict notice requirements.
Courts enforce notice clauses literally; in Gaymark Investments Pty Ltd v Walter Construction Group Ltd (1999) NTSC 143, failure to serve a timely notice barred an otherwise valid extension claim. The Court stated at [49-50]:
Concrete Constructions was delayed for a further 77 working days by causes for which Gaymark was responsible… but its application for extension of time was barred because of the failure of Concrete Constructions to meet the notification requirements of the contract’s extension of time clause.
Concurrent delay requires explicit treatment, either apportionment or builder risk allocation.
Liquidated damages (LDs) should reflect the owner’s actual financial loss; rent, holding costs, or lost income, and avoid punitive excess, which could be of no effect to the extent of the inconsistency under Andrews v Australia and New Zealand Banking Group Ltd (2012) 247 CLR 205. The Court stated at [10]:
A stipulation prima facie imposes a penalty… if, as a matter of substance, it is collateral to a primary stipulation and… upon the failure of the primary stipulation, imposes… an additional detriment… If compensation can be made… the collateral stipulation and the penalty are enforced only to the extent of that compensation.
Acceleration clauses should specify the owner’s direction, the pricing basis, and the evidentiary requirements to avoid disputes later.
Variations (Dispute-Proofing)
Section 19 of Sch 1B mandates that all variations be in writing, signed by both parties, and executed before commencement of the varied work. Oral variations are unenforceable (unless in an emergency).
Failure to comply with statutory variation formalities may extinguish a builder’s entitlement to payment for extra work, even where the work has been performed, reflecting the strict consumer-protection purpose of the domestic building regime.
Each variation must specify the price, scope change, and time impact, and be supported by quotes or cost breakdowns.
Clauses allowing builders to proceed unilaterally “where urgent” or “at owner’s risk” are inconsistent with the Act and unenforceable insofar as it conflicts with Schedule 1B.
Payment for variations shall not be claimed until written approval is obtained, to preserve transparency and auditability.
Practical Completion, Defects and Handover
Practical completion means the point at which the works are suitable for occupation, subject only to minor defects that do not affect use.
Contracts must state objective tests for completion and establish a written defects document signed by both parties.
Section 42 of Sch 1B implies warranties that the home will be fit for occupation and completed in accordance with plans and specifications.
The builder’s final payment entitlement arises only after practical completion certification and provision of warranties, manuals, and statutory certificates.
For scheme cover, structural defects are generally treated on a 6-year 6-month basis (subject to the scheme’s claim timing rules), and non-structural defects are generally treated on a 6-month basis from completion (with strict claim timing requirements).
Dispute Resolution and Escalation
Effective dispute clauses prescribe structured escalation to prevent premature litigation.
The hierarchy should require written notice of dispute, an internal meeting between parties, and mediation prior to arbitration or court proceedings.
The QBCC offers a complaints and dispute resolution process (often administered through Resolution Services), which may include inspections and directions to rectify where appropriate.
Where statutory remedies apply, QCAT retains jurisdiction for domestic building disputes under s 77 of the Queensland Civil and Administrative Tribunal Act 2009 (Qld).
Contractual arbitration clauses must yield to statutory consumer remedies where inconsistent, statutory dispute pathways override private arbitration where consumer legislation mandates public forum adjudication.
Clearly staged escalation procedures reduce cost and align with the statutory objective under r 5 of the Uniform Civil Procedure Rules 1999 (Qld) to ensure just, expeditious, and cost-effective resolution of disputes.
These clause-by-clause negotiations define the commercial and legal architecture of a domestic building contract.
Each lever, scope clarity, pricing transparency, payment discipline, time control, variation governance, completion integrity, and dispute structure, determines whether the contract functions as a fair risk allocation or a litigation blueprint.
| Clause Type | Typical Builder Position | What We Push For |
|---|---|---|
| Deposit | Maximum permitted or higher | Statutory cap only |
| Progress Claims | Front-loaded percentages | Value-based stages |
| Variations | Builder discretion or urgency carve-outs | Owner approval and pricing |
| Prime Cost / PS | Low allowances, open-ended | Defined caps and margins |
| EOTs | Broad causes, strict notice bars | Balanced risk allocation |
| Liquidated Damages | Minimal or nil | Reflective of real loss |
| Price Escalation | Discretionary adjustments | Objective triggers only |
| Document Precedence | Specs override drawings | Clear owner-favourable hierarchy |
| Termination Rights | One-sided builder rights | Mutual and lawful rights |
Form-Specific Tips (HIA, Master Builders, QBCC)
Standard form residential building contracts, HIA, Master Builders, and QBCC, are industry-authored instruments drafted primarily to protect builder interests.
They are not neutral templates and are frequently modified by annexures or special conditions that shift risk, limit remedies, and expand builder discretion.
Builders often append “special conditions” to standard forms that operate to:
- broaden extension-of-time entitlements.
- convert fixed price contracts into de facto cost-plus arrangements.
- restrict liquidated damages or impose short notice bars.
- reallocate risk for latent site conditions, service connections, and design coordination; and/or
- expand variation rights to include price adjustments for supplier or labour increases.
These amendments are frequently buried in specifications, quotes, or schedules rather than the main body of the contract.
In Brirek Industries Pty Ltd v McKenzie Group Consulting (Vic) Pty Ltd [2014] VSCA 165, the Court of Appeal confirmed that contractual obligations are determined by reference to the whole contractual framework, including documents and instruments incorporated expressly or by necessary implication. The Court stated at [114]:
The task is to construe the agreement by reference to the whole of the contractual context, including the documents and instruments which give it content.
The decision reinforces that specifications and ancillary documents forming part of that framework may operate as binding contractual terms, even where not physically annexed to the main agreement.
A line-by-line review of every annexure and reference document is therefore necessary.
The Queensland Building and Construction Commission Act 1991 (Qld), Sch 1B, provides statutory consumer protection that overrides inconsistent contract terms.
The QBCC-issued domestic building contracts, unlike private industry forms, are designed for compliance with these statutory requirements.
They automatically include the Consumer Building Guide, compliant progress payment schedules, variation approval clauses, and deposit limitations consistent with s 13, 33 and s 40 of Sch 1B.
For small- to mid-value residential builds, QBCC contracts provide greater regulatory consistency and reduced litigation risk.
Insurance and Risk Transfer (Owner Protections)
The Queensland Home Warranty Scheme, established under Part 5 of the QBCC Act, provides mandatory cover for residential building work exceeding $3,300 in value.
The builder must pay the insurance premium before starting work and provide the owner with a Notice of Cover within 14 days. Coverage applies to:
- Non-completion (builder insolvency, death, or disappearance).
- Defective work (structural – 6 years and 6 months; non-structural – generally 6 months from completion, subject to strict claim timing rules); and
- Subsidence or movement.
Builders must also hold and maintain independent insurance policies:
- Public Liability Insurance for third-party injury or property damage; and
- Contract Works Insurance for accidental loss or damage during construction (fire, storm, vandalism, theft).
Owners should require current certificates of currency for both insurance policies, specifying the project address and coverage period, before commencement.
Failure to obtain Home Warranty Insurance constitutes a serious statutory breach and may restrict or defeat contractual enforcement, expose the builder to penalties, and strengthen owner defences.
Payment Protection and the BIF Act
The Building Industry Fairness (Security of Payment) Act 2017 (Qld) (“BIF Act”) enforces strict payment discipline within the Queensland construction industry.
Under Part 3, a builder may issue a payment claim identifying work performed, and the recipient must respond with a payment schedule within 15 business days unless the contract specifies a shorter period.
Failure to respond converts the claimed amount into a statutory payment obligation recoverable as a debt, regardless of underlying disputes.
The Supreme Court in McNab Developments (Qld) Pty Ltd v MAK Construction Services Pty Ltd & Ors [2014] QCA 232 confirmed that procedural non-compliance, even by inadvertence, eliminates substantive defences to payment. The Court stated at [69]:
Where the contractor has failed to deliver a payment schedule in time, it is precluded from making submissions to the adjudicator.
Queensland’s security of payment law has long been applied strictly: failure to serve a payment schedule within time can have serious consequences, including precluding certain responses in adjudication. Under the current BIF Act, the statutory timeframe is generally 15 business days (or earlier if the contract provides).
For homeowners and investors, particularly those managing multiple builds or interstate projects, administrative oversight is the primary exposure.
Payment claims are often sent electronically; missing or misfiling these notices can result in automatic liability under s 76.
Investors and “non-resident owners” should implement rigorous document management policies, including centralised inboxes for claim receipt, tracking registers, and delegation protocols to ensure responses are made within statutory timeframes.
The BIF Act operates concurrently with the QBCC Act and is not displaced by domestic building contract protections.
Governance During Delivery (Make Administration Easy)
When conducting building contract reviews, effective contract administration during construction prevents disputes and evidences compliance.
The owner must ensure the following governance framework operates from the commencement:
- Commencement Notice and Program: Confirm written notice of start date, program milestones, and estimated completion. The contract’s agreed timeframe activates the implied warranty under s 42(3) of Sch 1B to complete within a reasonable time.
- Site Instructions in Writing: All directions, changes, and approvals must be issued in writing. Oral instructions invite disputes and breach the statutory variation requirement in s 19 of Sch 1B.
- RFI (Request for Information) and Change Control: Implement a register for all builder information requests, variation proposals, and approvals. Ensure each variation is priced, time-adjusted, and signed before work proceeds, as reinforced by O’Brien v Smolonogov [1983] FCA 333*, where unrecorded extra work was unrecoverable.
- Progress Claim Verification: Each payment claim must be reconciled against actual work completed, consistent with s 40 of Sch 1B. Builders cannot claim payment for uncompleted stages.
- Records Management: Maintain dated correspondence, site photos, approvals, inspection certificates, and progress reports. These documents form the evidentiary foundation for defect or delay claims.
- Practical Completion and Close-Out: Require a written declaration of practical completion, a defects list signed by both parties, delivery of statutory certificates, manuals, and warranties. The builder’s final payment entitlement only arises after these conditions are met.
Failure to observe these governance controls often results in disputes escalated to the QBCC or QCAT under s 77 of the Queensland Civil and Administrative Tribunal Act 2009 (Qld).
Consistent administrative discipline during construction preserves statutory rights, mitigates financial risk, and strengthens evidentiary positions in any subsequent adjudication or tribunal proceeding.
Red Flags (Walk-Away Signals)
When conducting building contract reviews, certain contract features and omissions indicate high risk and systemic non-compliance under Queensland law.
These are objective indicators that the proposed agreement is either unenforceable, unbalanced, or likely to result in dispute escalation.
- Excessive or Unlawful Deposit — Section 33 of Schedule 1B to the Queensland Building and Construction Commission Act 1991 (Qld) (“QBCC Act”) caps deposits at 10% for contracts below $20,000 and 5% for those at or above $20,000, except where substantial off-site fabrication is proven. Builders demanding larger deposits contravene statutory limits and commit an offence under s 33. Any such demand signals disregard for compliance and foreshadows later breaches.
- Heavily Front-Loaded Progress Claims — Section 40 of Schedule 1B requires that progress payments reflect actual work performed. Front-loaded progress schedules that require payment materially in advance of the value of work performed risk contravening Schedule 1B and may be unenforceable.
- Sweeping Builder Discretions — Clauses granting unilateral powers—price escalation “at builder’s discretion,” unrestricted variation rights, or unilateral extension of time (EOT)—are inconsistent with the statutory fairness objective embedded in Schedule 1B.
- Uncapped Allowances — Prime Cost and Provisional Sum allowances without defined upper limits convert fixed-price contracts into uncontrolled cost-plus arrangements, contravening s 55 of the QBCC Act. Unbounded allowances are a financial red flag; cost overruns cannot be predicted or controlled.
- Onerous Time-Bars — Clauses requiring owners to respond within impracticably short periods or forfeiting rights for failure to issue written notices breach the equitable principles underpinning consumer protection. In Gaymark Investments Pty Ltd v Walter Construction Group Ltd (1999) NTSC 143, a failure to issue notice within a narrow window extinguished the claim; owners should reject such provisions as procedural traps.
- Special Conditions Buried in Specifications — Hidden amendments in technical schedules, quotations, or inclusion lists have full contractual force under Brirek Industries Pty Ltd v McKenzie Group Consulting (Vic) Pty Ltd [2014] VSCA 165*. Conditions shifting liability for design, certification, or service connections into specifications are deliberate obfuscations.
- No Clear Variation or EOT Process — Section 19 of Schedule 1B renders oral or informal variations unenforceable. Contracts lacking written variation protocols or silent on EOT notification windows fail statutory standards. Such omissions eliminate procedural certainty and render cost recovery arbitrary.
- No Home Warranty Insurance Evidence — The builder must pay the premium and deliver a Notice of Cover under Part 5 of the QBCC Act before work commences.
These indicators reveal non-compliance with Schedule 1B, imbalance of rights, or concealed contractual risk. Presence of two or more of these elements justifies non-execution.
| Red Flag | Why It’s Dangerous | Legal Consequence |
|---|---|---|
| Excessive Deposit | Breaches statutory caps | Offence and unenforceable payment |
| Front-Loaded Payments | Payment before work value | Dispute or refusal to pay |
| Uncapped PC / PS Items | Hidden cost escalation | Budget blowouts |
| Oral Variations Allowed | No written control | Loss of payment rights |
| Builder Price Discretion | Unilateral risk shifting | Unfair or unenforceable |
| Missing Insurance Proof | No scheme protection | Uninsured loss exposure |
| Buried Special Conditions | Concealed risk transfer | Litigation leverage |
| No Precedence Clause | Document conflict | Builder interpretation wins |
| Aggressive Time Bars | Procedural traps | Rights extinguished |
Practical Checklists and Templates
When conducting building contract reviews, effective contract preparation in residential construction depends on procedural discipline before execution.
A structured checklist converts statutory obligations under Schedule 1B of the Queensland Building and Construction Commission Act 1991 (Qld) into measurable verification tasks, ensuring the builder’s compliance and the owner’s protection.
The 20-point pre-sign checklist functions as a forensic control tool, testing the licence validity, insurance, documentation, pricing integrity, and statutory alignment of the proposed agreement.
Each verified item eliminates a potential source of post-contract dispute, ensuring the contract is lawful, balanced, and enforceable before signatures are applied.
- Confirm builder’s QBCC licence status, class, and disciplinary history.
- Obtain builder’s insurance certificates for public liability and contract works.
- Confirm delivery of the Consumer Building Guide.
- Verify deposit does not exceed s 13 limits.
- Ensure progress payments align with actual construction stages under s 40.
- Confirm builder has paid HWI premium and provided Notice of Cover.
- Ensure Prime Cost and Provisional Sums are capped and itemised.
- Check that liquidated damages are realistic and non-punitive.
- Confirm time for completion and clear EOT notice requirements.
- Verify detailed scope of work, signed plans, and specifications.
- Ensure inclusions and exclusions are explicitly listed.
- Review for hidden special conditions in specifications or quotations.
- Confirm document precedence hierarchy is defined.
- Verify variation process is written and requires mutual consent (s 19).
- Review dispute resolution clause for QBCC or QCAT compatibility.
- Confirm builder’s margin on variations is specified numerically.
- Verify progress and retention structure aligns with lender valuation policy.
- Ensure warranties and maintenance obligations reflect statutory minimums
(s 42). - Cross-check selections, fixtures, and finishes schedules.
- Ensure all annexures, engineering reports, and soil tests are appended and dated.
This checklist ensures alignment with statutory formalities under Schedule 1B and mitigates hidden risk transferred through special conditions or omissions.
Key Takeaways – Building Contract Reviews
When conducting building contract reviews, preventative diligence is the singular determinant of contractual success in Queensland residential construction.
Every defect, delay, or dispute originates from unexamined clauses or incomplete documentation.
The cost of forensic review before signing is negligible compared to litigation and rectification expenditure.
“Standard form” contracts are templates, not regulatory shields; compliance depends on amendment, verification, and alignment with statutory obligations.
When conducting building contract reviews, a contract executed without complete review, verified insurances, and documented scope is not a bargain but a liability instrument.
What We Review in a Building Contract
| Review Area | What We Examine | What This Protects You From |
|---|---|---|
| Contract Type & Structure | Whether the contract type matches the work (fixed price, cost-plus, renovation, new build) | Statutory non-compliance and unenforceable terms |
| Builder Licensing | QBCC licence class, scope, currency, and disciplinary history | Unlicensed work and restricted recovery |
| Home Warranty Insurance | Premium payment, Notice of Cover, timing before commencement | Loss of insurance protection for defects or non-completion |
| Consumer Building Guide | Correct delivery and timing | Loss of cooling-off and statutory rights |
| Deposit Limits | Compliance with statutory deposit caps | Offences and unlawful upfront payments |
| Progress Payments | Stage percentages vs actual work value | Front-loaded or premature payment claims |
| Scope of Works | Plans, specifications, inclusions, exclusions | Ambiguity leading to disputes and variations |
| Prime Cost & Provisional Sums | Allowance amounts, caps, margins, and adjustment method | Hidden cost escalation |
| Variations | Written approval, pricing, time impact | Unrecoverable extras or inflated claims |
| Time & Delays | Completion dates, EOT triggers, notice requirements | Delay disputes and loss of remedies |
| Liquidated Damages | Amount, triggers, enforceability | Ineffective or punitive LD clauses |
| Price Escalation | Clauses allowing cost increases | Uncontrolled price increases |
| Special Conditions | Builder-added amendments and annexures | Hidden risk transfer |
| Document Precedence | Hierarchy between contract, specs, drawings, quotes | Builder reliance on secondary documents |
| Insurance (Other) | Public liability and contract works cover | Uninsured damage or third-party claims |
| Dispute Resolution | QBCC, QCAT, mediation compatibility | Invalid or costly dispute pathways |
| Termination Rights | Grounds, notice, consequences | One-sided termination exposure |
| Practical Completion | Completion tests, defect lists, handover requirements | Premature final payment |
| Statutory Warranties | Compliance with non-excludable warranties | Loss of long-term protection |
| Administrative Traps | Time bars, notice clauses, service methods | Rights lost by missed deadlines |
Frequently Asked Questions
These FAQs answer common questions about building contract reviews and explain how early legal scrutiny reduces risk before you sign.
They clarify how a proper review identifies non-compliant clauses, hidden cost exposure, and dispute triggers under Queensland law.
What is a building contract review?
A building contract review involves a qualified lawyer examining a construction or domestic building contract before it is signed. The review focuses on risk allocation, payment terms, variations, delays, extensions of time, defects, and dispute resolution clauses to ensure the contract is fair, compliant with legislation, and protects your interests.
Why should I get a building contract reviewed before signing?
Once signed, a building contract is legally binding. A pre-signing review can identify unfair clauses, hidden cost risks, strict notice requirements, or one-sided provisions that may expose you to significant financial loss or disputes later. Early review is far cheaper than resolving problems through litigation.
Are standard form building contracts safe to use?
Not always. While standard form contracts (such as HIA or Master Builders contracts) are common, they are often drafted in the builder’s interests and may still contain clauses that unfairly shift risk to the homeowner. Courts routinely enforce these clauses unless they are of no effect to the extent of the inconsistency or unconscionable.
What clauses should I pay close attention to in a building contract?
Key clauses include payment schedules, variations, provisional sums, prime cost items, extensions of time, liquidated damages, defect liability periods, termination rights, and dispute resolution procedures. Small drafting details in these clauses can have major financial consequences.
Can a builder rely on specifications or quotes that are not in the main contract?
Yes. Courts have confirmed that documents incorporated by reference such as specifications, drawings, schedules, and attached quotations can form part of the binding contract even if not physically annexed. This makes reviewing all referenced documents critical.
What happens if a variation is not put in writing?
In most domestic building contracts, and under Queensland legislation, variations must be in writing and approved before the work is carried out. If this process is not followed, the builder may lose the right to payment for the variation, even if the work was performed.
How do building contract reviews help with delays and extensions of time?
A review identifies whether extension of time clauses are drafted strictly, what notice is required, and who bears delay risk. Courts often enforce notice provisions literally, meaning failure to comply can prevent a builder from claiming extra time or can expose owners to delay damages.
What are prime cost items and provisional sums?
Prime cost (PC) items and provisional sums (PS) are allowances for work or materials not fully defined at contract signing. Poorly drafted PC and PS clauses can allow significant cost escalation. A contract review ensures pricing mechanisms and margins are clearly defined and transparent.
Can unfair building contract clauses be challenged?
Some clauses may be unenforceable under unfair contract terms legislation or domestic building laws, particularly where they create a significant imbalance or allow unilateral price increases. However, courts will not rewrite contracts simply because they are bad bargains pre-emptive review is essential.
Who should get a building contract reviewed?
Anyone entering a residential or commercial building contract homeowners, developers, builders, or subcontractors should obtain a review. Contract reviews are especially important for high-value projects, renovations, or where non-standard terms or extensive specifications are involved.
