Contemplating a building alteration to your home?  Attorney Albert van der Bilt, who specialises in construction law, offers some tips on how to avoid misunderstandings with your building contractor.

It is not unheard of or uncommon for the average homeowner, either as result of necessity, careful planning or an inexplicable rush of blood to the head, to decide to embark on a house improvement or extension project.

For a homeowner with the necessary expertise, knowledge and management abilities, this could be done by direct appointment of labour working under personal supervision. For the fortunate souls who have these abilities this is invariably the cheapest option.   The other alternative is to appoint an architect or draughtsman (or designing your own extension or alteration) and appointing a contractor to do the work.

Finding a contractor

Once the plans have been approved by all requisite authorities, the real difficulty begins.

Finding the correct building contractor on multi-million Rand projects such as in the public sector is normally done by tender process. Your average homeowner does not have the finances or administrative ability to conduct such a process, and normally follows a fairly messy process of referrals and perusing advertising to contact a contractor who will then provide a quotation reflecting what he will charge to do the alterations. This unfortunately is only the tip of the iceberg, and horror stories abound of lost money, endless construction problems and unfulfilled expectations with the contractor appointed.

Works Contract

The terms of your agreement with your contractor are broadly covered under what the ancient Romans called a “works contract”. These provisions apply automatically once you and the contractor agree that he will do the specified work at an agreed price. It provides that the work must be done in the proper and workmanlike manner, and that you must pay for same.

Unfortunately, aspects such as time of commencement, time of completion and structured payments are NOT dealt with in the common law Works Contract, which relies on the rather subjective default of “reasonableness”! Even more importantly, any variation to what was initially planned or drawn effectively requires an additional contract for any change to be effected. No effective mechanisms to deal with unhappiness on the part of either party or even breach of the contract, are provided for outside of recourse to lawyers and courts.

Some contractors will have their own standard form of agreement, unfortunately often speckled with outrageous clauses in their favour.

Minor Works agreement

In South Africa an institution known as the Joint Building Contracts Commission has drafted a very effective “Minor Works Agreement” for use in the building industry. It clearly specifies the duties of the employer (yourself) and the contractor, methods and procedures of how to deal with disputes and time periods in which the work must commence and be finalised. A cheap(er) dispute resolution mechanism than the court system is also provided for in the Minor Works Agreement, in the form of adjudication

In respect of payments, it regulates what amounts are to be paid and when, and if required retention of part of the payments to be paid as security for work not properly done.

Your diagrams, specifications and drawings should clearly indicate must be done and will be known as the “scope of works”. Most importantly, should you require amendments to your initial plans which do not deviate substantially from what was initially agreed, the agreement will give you the right to instruct the contractor to do this, subject of course to your paying for the variations at an agreed rate or an appropriate rate for similar work done under similar circumstances at the time.  This is not provided for in the common law Works Contract.

The document is straightforward, and obtainable from the SA Institute of Civil Engineers in Midrand, and well worth looking at prior to appointing a contractor.

Albert van der Bilt, Construction Law specialist.  083 414 5927  / albert@vanderbilt.co.za

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