Eight days ago Premier Chris Minns was in Lismore to announce the very first Resilient Lands Program on Crawford Road, East Lismore with the promise that this is the first of many announcements to come.

The 400 blocks that will be released for East Lismore and the thousands more to be revealed in 2024 will lead to a building boom over the next five to ten years.

Many old and new residents will be entering into building contracts with their builder of choice. As with any program, there will be issues that arise in the rebuild of Lismore and the Northern Rivers.

Local construction lawyer Duncan Macfarlane told the Lismore App it is amazing how many people will spend $1000 or more in hiring a building inspector and a conveyancer when purchasing a house but they generally won't spend any money on legal advice before entering into a building contract that could potentially save them tens of thousands in hidden variations or costly disputes.

"I think homeowners and builders alike ought to take care to make sure they understand what they are really entering into so the rebuild ends in smiles all round," Duncan said.

Duncan spent 16 years as a commercial barrister mainly in building and construction. He lived through the 2017 and 2022 Lismore floods and now runs his own legal firm in Molesworth Street.

“Before entering into any building contract homeowners and builders should both have a good think about a few key matters to avoid costly disputes.

"Firstly, is the builder properly licensed and insured? Any person doing residential building work in NSW must be properly licensed with Fair Trading. If the value of the work is over $20,000 the builder must also obtain Home Warranty Insurance.

"Secondly, is the homeowner really ready to build? A building project is the coming together of council requirements, architectural plans, engineering plans and more. Has the builder sufficient information to properly price a build without further information or detail? If not, this is fertile ground for disputes to arise; leading to costly variations and completion time blowouts.

"Thirdly, have you determined what contract is appropriate? Contracts must be in writing or they can be unenforceable. Contracts have important components including scope of work, payment stages, time for completion, defect rectification and termination and more – such contractual components need to be properly understood and often require legal advice to ensure proper steps are taken.” 

In Duncan’s experience, as a barrister, he saw first-hand many disputes that occurred because the parties had not taken legal advice at an appropriate stage.

“People generally do not hesitate to pay $1,000 plus for a conveyance but hardly ever get legal advice before embarking on a residential construction which is much riskier and much more likely than a conveyance to lead to dispute.”

A common issue that arises, in Duncan’s experience, is variations arising out of discussions on site.

“By and large building professionals are honest and decent and homeowners really do want to trust who they are dealing with,” Duncan says. “However, when it comes to any variation to the terms of a building contract, too often recollections as to conversations differ."

"Any proposed variation should be put in writing by the Builder with proper details of cost and time and how it is incorporated into the main contract. The homeowner should think very carefully about agreeing to it and should only do so when they are satisfied they actually understand what it means for them.”

Duncan also described a common occurrence of a Homeowner being unsatisfied with the quality and progress of the builder’s work and a feeling of being stuck with the builder, hoping the situation will improve.

Duncan says the best approach is usually what he refers to as ‘structured communication’ with the Builder.

“The communication should be in writing as far as possible, with photos and constant reference to what the parties actually agreed. In this structure, communication will focus on the bargain between the parties and the respective legal rights and obligations. This enables a problem-solving approach and minimises distracting and unhelpful arguments.”

Duncan says before undertaking any building project, including house relocation, it is important to do your research and find out what can go wrong and then identify what steps might be taken to ensure such risks are accounted for in the contract to avoid nasty surprises.

Sound advice when Lismore and the Northern Rivers residents have been through enough in the last two years.

You can contact Duncan Macfarlane at dmac@macfarlaneconstructionlaw.com.au or visit the website at www.macfarlaneconstructionlaw.com.au.