Why building disputes are inevitable in any property transaction
Whether you are building a home or buying one, you can expect it to be a long and tedious process. You will encounter a combination of environmental and behavioural situations that may cause problems.
Many of these causes can be hard to predict and equally hard to address. This can result in disagreements that may lead to litigation.
Common causes of building disputes
- Communication – a difference of opinion about the design or differences in goals make it hard to both builder and buyer to communicate.
- Costs – this is the most common issue in building disputes. Discussing budget or unpaid invoices can be uncomfortable for all parties and is often the cause of disagreements.
- Coordination – in building or construction, you may deal with different trade experts. There is a tendency for a conflict when an issue arises, with each blaming the other.
- Delays – justifying the cause of the delays or who will shoulder the blame for delays often occur especially if the project has both time and budget constraints.
- Workmanship – because the specification of quality workmanship can be vague, expect disagreements between parties about whether the works meet the expected standard.
- Variations and Improvements – plans sometimes change as the work progresses. Often it is impractical or time-consuming to make changes and this can cause arguments.
What to do if you feel you are heading towards a dispute about your building
If you find yourself disputing any aspect of the building works, here are the steps you take if you are unable to resolve the disagreement with the other party.
- The most cost-effective step is to mediate or arbitrate with the other party. Mediation can offer a speedy resolution by helping the opposing sides reach an agreement that is fair to both.
- Note that all home building disputes must be referred to NSW Fair Trading before an application can be made to the NSW Civil and Administrative Tribunal (NCAT).
- If dispute resolution is unsuccessful, then the jurisdiction of the Tribunal will allow parties to make claims to a value of $500,000, as per the Home Building Act 1989.