Recently I was assisting owners on their 1M build that had run into problems. Builder was not performing and there were numerous defects with the build. Builder was trying to get to lockup and to extract his next progress payment and there were prior negotiations about both parties walking away ending the contract.

In essence builder was aiming for somewhat discounted lockup progress claim before calling it quits. The owners who were already talking to another builder entertained the idea of paying the builder lockup claim (when achieved) and just getting him off the site but were worried about cost of defect rectification.

Once I became involved I was able to confirm substantial defects however there was a “King Hit”.  Oblivious to the owners, builder has over claimed on progress payments and was claiming and getting paid for the work not yet done. In essence the amount of overpayment was almost the value of the next lockup progress payment.

Without realising, owners had already seriously overpaid the builder  and were now facing serious budget shortfall and not enough money to rectify defects and finish the job.

The owners who had no experience in building and building contract administration were not prudent enough to engage independent expert to assist them with their build.

Oh how they wish they had!