What are contract terms?

Contract terms are those parts in the Housing Industry Association (HIA) Domestic Building Contract that set out each party’s rights, liabilities, and obligations. They are organised into different clauses.

Important terms to watch out for

To minimise risks to cost, time, and quality, it is important to be mindful of the following terms or clauses from the Housing Industry Association Victorian New Homes Contract.

Cooling Off Period
What it doesImportanceRisk minimised
Allows home owner to terminate the contract 5 days from signingSo you can opt out of the contract before the build✓Cost
✓Time
✓Quality
Time for Completion
What it doesImportanceRisk minimised
Sets the period within which the building project should be completedThis affects other matters like damages (monetary compensation for delay)✓Time
✓Cost
✓Quality
Contract Price
What it does Importance Risk minimised
Sets out the total cost of the project, including tax So you know the contract accurately reflects the cost you agreed to ✓Cost
Progress Payments
What it doesImportanceRisk minimised
Sets the different stages of completion and the corresponding cost for eachTo make sure you’re on top of your financial obligations, and that you don’t incur penalties or interest for late payment✓Time
✓Cost
✓Quality
Commencement and Building Period
What it doesImportanceRisk minimised
Sets out the start date of the building projectThis affects other issues like completion✓Time
✓Cost
Statutory Warranties
What it doesImportanceRisk minimised
Sets out the builder’s obligations under the lawSo you know your rights in case the builder commits breach✓Time
✓Cost
✓Quality
Variations
What it doesImportanceRisk minimised
Sets out the instances when and the procedure on how to validly make variations (changes on the original plan)So you won’t get duped into paying for unauthorised variations✓Time
✓Cost
✓Quality
Extension of Time
What it doesImportanceRisk minimised
Sets the grounds and the process for the Builder to claim a valid extension of time to finish the projectSo you know if the claim for extension of time is valid, or if it is an inexcusable delay✓Time
✓Cost
✓Quality
Extension of Time
What it doesImportanceRisk minimised
Sets the grounds and the process for either party to
terminate the contract
So you can properly terminate the contract for cause✓Time
✓Cost
Disputes, Conciliation, and Tribunal
What it doesImportanceRisk minimised
Sets out the procedure for resolving
building disputes
So you know your recourse in case of dispute✓Time
✓Cost
✓Quality

How We Can Help

These are the most important terms you need to review, and these are common sources of dispute. For a more detailed and thorough review of your entire HIA contract, feel free to get in touch with us. Construction Lawyer Melbourne specialises in Contract Review and Advice.