What is Commercial Law?
Commercial law is a broad field that encompasses a wide range of legal issues related to business and commerce. Some of the key practice areas within commercial law include:
- Insurance law
- Corporate law
- Intellectual property law
- Property law
- Employment law
- Contract law
- Tax law
- Construction law
A construction lawyer typically has working knowledge of all verticals of the construction industry, including industrial, infrastructure, mining, commercial, and residential. This includes:
- Contract drafting and negotiation
- Construction disputes
- Construction defects
- Represent in courts and tribunals
Whilst a Home Building Act solicitor also has expertise with the above, construction lawyers who practice in other verticals will apply their knowledge and have experience to their vertical specific laws and issues such as those applicable to roads, mining, industrial, property, and infrastructure law. They will not have the domain and vertical knowledge and experience to deal with the practical issues that a construction lawyer who focuses on home building act work would have.
Typically construction lawyers advise and represent clients such as construction companies, architects, engineers, developers, and contractors on a wide range of legal issues. Of course they may also have understanding of laws and regulations specific to the industry, such as the Home Building Act, and may advise and represent clients in disputes related to those laws but their practical advice will be limited due to their lack of focus on residential construction matters.
Home Building Act Lawyer
Home Building Act Lawyers have an in-depth knowledge of the Home Building Act, Home Building Regulations, Design and Building Practitioners Act, and related legislation, codes, standards, and practices. They are well-versed with relevant case law where those statutes are applied. They have strong experience working with matters that affect homeowners and builders with practical issues that arise with building a residential home in New South Wales. They are specialised in advising on contracts and issues from pre-construction phase to dispute resolution.
Home Building Act Lawyers will represent clients on compliance with the Home Building Act and related legislation, as well as representing clients in disputes related to the act, such as:
- Defects and incomplete works
- Quantum Meruit claims
They have strong knowledge of the processes and procedures for lodging and resolving disputes under the Home Building Act through the NSW Civil and Administrative Tribunal as well as all levels of the courts system. They are more focused on representing Homeowners and Builders under the Master Builders, HIA, and Office of Fair Trading Contracts.
Choosing the Right Lawyer for Your Home Building Dispute
When it comes to choosing a lawyer for your home building dispute or issue, it’s important to consider the specific nature of your problem. If your issue is related specifically to the Home Building Act and related legislation, a Home Building Act lawyer would be the best choice. If your issue is more general in nature and relates to the construction industry as a whole, a construction lawyer may be more appropriate.
It’s also important to keep in mind that both types of lawyers may have knowledge of the Home Building Act and related legislation, so they may be able to assist you in either case. However, a Home Building Act lawyer will have a more specialised knowledge of the act and related legislation and will be better equipped to advise you on compliance and to represent you in disputes.
Home Building Act lawyers specialise in legal issues related to the Home Building Act and related legislation in NSW and have experience working with practical issues that arise with building a residential home.
Construction lawyers have knowledge of all verticals of the construction industry including drafting and negotiation of contracts, construction disputes, and other legal matters related to the industry.
Understanding Quantum Meruit in Construction Contracts
Quantum meruit, a Latin term meaning “as much as deserved”. In the construction industry, it commonly used to claim reasonable remuneration for work done or materials supplied for work that is outside the scope of the original contract or where the contract is silent on the payment for additional work. This principle is often applied in cases of variations not signed and accepted by owners.
Definition and Application
Quantum meruit operates as an implied contract, allowing builders to claim reasonable remuneration based on the value of the work done or materials supplied.
The principle of quantum meruit is applicable where there is no agreement regarding payment for additional work or where the agreement is frustrated, avoided, or unenforceable. This might occur where variations have not been documented in accordance with the contractual provisions, or where the owner has not signed off on the changes.
Variations Not Signed and Accepted by Owners - What Does It Mean?
In construction contracts, variations refer to changes to the original scope of work. These can arise due to various reasons such as design changes, unforeseen site conditions, or the owner’s request for additional work. In most cases, variations must be documented and signed by the owner before the builder can proceed with the additional work.
However, in some cases, variations may not be documented in accordance with contractual provisions, or the owner may not sign off on the changes.This can occur for a range of reasons, such as where the owner is unavailable or unresponsive, or where the builder proceeds with the additional work without formal approval.
When variations are not signed and accepted by owners, it means that the builder may not be entitled to claim payment for the work done under the terms of the original contract. However, the builder may still be able to claim payment on a quantum meruit basis.
It is important to note that variations not signed and accepted by owners are not automatically recoverable on a quantum meruit basis. The builder must still meet the requirements for a successful quantum meruit claim, and there may be other factors that impact the outcome of the claim, such as whether the variations were essential to the completion of the project or whether they were requested by the owner.
In the following sections, we will examine the key components of a successful quantum meruit claim and provide practical advice for builders looking to recover costs for variations not signed and accepted by owners.
Recovering Costs for Variations Not Signed and Accepted by Owners
|Item||Key Conditions for Quantum Meruit||Explanation|
|1.||The subject building work fell outside the requirements of the contract, specifications, and other included contract documents.||Builders must be able to demonstrate that the work done falls outside the scope of the original contract and any included documents. This means that the variations were not part of the original agreement and were not required to complete the project.|
|2.||The owner had actual knowledge of the variations as they were being done.||Builders must show that the owner was aware of the work being done and the changes to the scope of work. This can be demonstrated through regular communication with the owner or through written correspondence.|
|3.||The owner knew that the variations were outside the contract.||Builders must be able to show that the owner understood that the variations were not part of the original contract and were not required to complete the project. This can be demonstrated through written correspondence or through regular communication with the owner.|
|4.||The owner knew that the builder expected to be paid for the work as a variation to the contract.||Builders must show that the owner understood that the work was being done on a variation basis and that they would be required to pay for the work completed. This can be demonstrated through written correspondence or through regular communication with the owner.|
|5.||The builder provided evidence that the amount claimed was fair value.||Builders must provide evidence that the amount claimed is fair and reasonable for the work completed outside the scope of the original contract. This can be demonstrated through invoices, quotes, or other evidence of the value of the work completed.|
Practical Advice for Builders
To successfully claim quantum meruit for variations not signed and accepted by owners, builders should follow these practical steps:
- Keep accurate records of all work completed and materials supplied, including any variations.
- Ensure that all variations are documented in accordance with the contractual provisions, and signed off by the owner wherever possible.
- If variations are not signed and accepted by owners, communicate regularly with the owner to ensure that they are aware of the work being done and the costs associated with it. Maintaining regular communication often helps with avoiding disputes.
- Provide evidence to support the claim, such as photographs, invoices, and correspondence.
- Seek legal advice if necessary to ensure that the claim is made in accordance with the relevant laws and regulations.
Recovering costs for variations not signed and accepted by owners on a quantum meruit basis is a complex but achievable process. By understanding the legal principles and following the key requirements, and following these practical steps, builders can increase their chances of recovering costs and ensure fair payment.
Each contract is unique, and navigating the complexities of variations and quantum meruit claims requires specialised knowledge.If you’re a builder facing challenges with variations not signed and accepted by owners, or need guidance on quantum meruit claims, the legal maze can be overwhelming. Don’t let these challenges hinder your project’s success.Seeking legal consultation is vital to protect your interests and ensure compliance with the law.
As a solicitor and construction lawyer with more than 10 years of experience specialising in construction law, I have advised homeowners, builders, and contractors on their contract rights, risks, and obligations. We offer legal advice and legal representation for various residential construction matters, including Variations, Disputes, and Quantum Meruit claims. If you’re facing challenges with contract variations or quantum meruit claims, book your free first consultation with us today. We’re here to help you navigate the legal intricacies of the construction industry.