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Contracts between Builders and their Clients.

Updated: Feb 9, 2023

We’ve had two projects over the past two years where the client and builder have fallen out. This compares with four (including the two) projects in fifteen years where this has occurred. It can hardly be called a trend but just in case, it may be worth commenting on the contractual arrangements between builder and client. Now firstly let’s be clear and state that I am not a lawyer and all the contents of this blog are intended to be helpful and to point people in the right direction so if anything is of interest or importance to you, go check it out before you act. Do not rely on this blog.

Often the contract between the builder and homeowner is created at the owner's home or over the phone and these now all come under the provisions of the new Consumer Rights Act. Basically, it gives customers, the client, much more in terms of safeguards about workmanship and restitution when work is not up to standard. Let's face it, most contracts between builder and house owner are struck when the client says “yes ok mate, get on with it”. Often the terms are scant, to say the least, and at best are contained in a badly drafted letter from the builder, better still, they may refer to detailed plans that a company like Building Tectonics provide. This is perfectly acceptable as a contract and the law says that as long as there is an offer and an acceptance it’s a legally binding contract. However, problems arise when you’re trying to prove what was agreed with little agreed in writing. In my experience, nearly everyone we deal with is pretty honest and intends at the outset to do the right thing. Things unravel because of misunderstandings and the various pressures we all face in our busy and demanding lives. Sometimes under these circumstances, people start to twist the truth or even tell lies. This is where a good record of what was said and agreed upon is important, especially given it may be a year later when the arguments start. The new regulations may help with these situations.

One particular aspect of the new regulations is the right to cancel an agreement within 14 days. Even more important for the builder is that the builder has to tell the client that they have that right. If they do not make this clear then the client may have the right to cancel at any time during the job and trying to establish what will have to be paid for under these circumstances may get complicated. Given that many thousands of pounds may be at stake this should not be left to chance.

Clients should consider using a standard contract such as the ‘Joint Contract Tribunal’s Building Contract for a Home Owner/Occupier who has not appointed a consultant to oversee the work’ and have a good set of detailed plans showing the way the building is to be put together. Of course, choosing a good builder is essential too and it must be said that if only four projects out of four thousand or so end up in acrimony, it is a testament to the fact that most of the builders we associate with are honest and hard working. I guess the same must be said of our clients too.

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