Construction Contract Solicitor
I’ve walked in your shoes! As I have pretty well established by now, the law is my second major career. Prior to going to Uni in 2009 and becoming a Construction contract solicitor. I was working in the building and construction industries. My last project in the building industry was in Townsville, North Queensland. I was a project manager and the project was a multi-storey residential tower with a second tower for the carpark located in the Townsville CBD. We’d started the project in 2006.
At that time, construction in Townsville was booming. There were 10 tower cranes on the skyline and even finding a park each day was a major achievement. As with most building projects, this one had its ups and downs. One of the major downs was the project’s first form worker. The owner of the business, let’s call him Tory for the sake of a name, had worked on similar projects in Sydney when I was working for Meriton Apartments in the early 2000s. At that time, he usually managed to complete his contract on time and to budget. However, this had not equipped him for the challenges of building in a different state.
The problems begin
From the first day on site, Tory and his crew had problems. His first problem was getting a crew. In 2007, Townsville was in the middle of a labour shortage. They struggled for workers, especially good quality ones the entire time they were on the project.
At the beginning of his contract, Tory approached the Managing Director of the company I was employed by and asked for a $100,000 advance on his contract. Rather than being the helping hand it was intended to be, that pre-payment was probably one of the major reasons for the troubles that followed.
We started to have major issues about 1/3 of the way through the first tower. Tory and his crew were behind time and going backwards. That $100,000 was also coming back to haunt them. Tory could not afford to absorb that $100,000 into the monthly invoices and had to continually overclaim. Each month, a careful assessment of the works done was undertaken and each month a large part of Tory’s claim was knocked back. By now Tory was the bane of my life. He hassled me about his invoice, he hassled me about getting paid and generally he just tried to hassle me. And I responded. I policed his invoices, I cut them back if he overclaimed. I looked at his QA paperwork, his safe work method statements and his tag and test dates. I looked to make Tory and his crew accountable and made sure that he did not overclaim. I could see that the writing was on the wall. At some point Tory would fold and I would need to find another form worker to complete the work, so the amount of money left in the cost centre was of particular interest to me. If Tory overclaimed and went bust, I would need to find the additional money to pay the new form worker from elsewhere. Something had to happen and eventually it did.
The start of litigation
Tory submitted a claim and I assessed what he had claimed. As part of the assessment, it was clear that Tory was claiming for levels of work that he simply had not done. His claim was reduced accordingly and a claim was lodged under the Building Industry Fairness (Security of Payment) Act 2017 (Qld) (‘BIFA’). Additionally, the claim contained some 39 variations.
I was of course aware of the BIFA and we very carefully complied with its requirements whenever we received an invoice. At that stage the BIFA was still very new and I had not had to defend a claim. The claim was for $2,309,750.01 on a contract for a contract that was worth $4,497,479.30 which was approximately 52% complete.
Given the amounts of money involved we engaged with our legal team immediately and in particular our construction contract solicitor team. This close interaction was a first for me and I thoroughly enjoyed all the careful and painstaking work that we put into detailing and compiling our response. During a long evening telephone call with our construction contract lawyers, I remember the principal of the law firm saying to me “BIFA is law, but it’s not the full extent of the law which is a beautiful thing’. That comment has stuck with me all these years and I now know that he was right. Back then however, my focus was on the claim against us.
As I said before, the claim was for $2,309,750.01 and our payment claim was for $0, so the parties started the process a long way apart. However, with a lot of hard work and careful drafting, the adjudicated amount ended up being $129,605.72, a significantly reduced amount and probably a fair result.
Looking back now, I view the entire process through different eyes. I understand that so much of the law is about give and take. On most occasions, neither party is going to be 100% right, but back then I had a different view. As far as I was concerned, we were 100% right and Tory was 100% wrong, but that was not really the case. Tory probably got more than he was entitled to, but not by much.
I was right, Tory did not finish the project. He folded about a month later and we had to engage another company to complete the work.
I have walked in the shoes of a project manager and I have worked to comply with an adjudication response working in an arena that I did not understand. But I was lucky. I had a guide who knew what was required.
If I can give any advice to builders and project managers as a construction contract solicitor it’s this: do not wait. Get legal advice sooner rather than later. Legal problems are not problems that you are trained to fix, but I am. My experience in construction is a very real advantage for you because allows me to understand the nature of what a builder is seeking to use as a defence.
You will never have to pay me to understand building, I already do. Contact Becker Watt Lawyers on 07 3269 4888 for all your building & construction and commercial legal advice or if you require a construction contract solicitor.