After the Builder Is Appointed: What the Owner Still Holds

After the Builder Is Appointed: What the Owner Still Holds

General information for South Australian landowners only. This is not legal, financial or quantity surveying advice. What your contract's variation, payment and extension-of-time clauses do, what a notice under them means, and whether any payment may be withheld or deferred, is for an SA property lawyer or a solicitor experienced in building contracts. Whether a price for varied work is reasonable, and what has been built to date, are for a quantity surveyor or an independent building consultant. Consumer and licensing questions are for Consumer and Business Services; drawdowns for your lender or broker; tax for your registered tax agent. The terms of your own contract govern, and statutory requirements are amended over time, so confirm the live position before you rely on anything here.

The decision in front of you

A wall opens up, a soil result comes back, or a supplier date moves. Your builder sends through a price and a revised date, and you have a few days to answer. The question is not whether the number is fair in the abstract; it is what the contract you signed still gives you to work with, and where.

The competitive tension that was working for you while you chose a builder ends the moment you appoint. Every change, discovered condition and programme slip is now negotiated with the one party able to do the work, and what you have instead of competition is whatever your contract preserved before you signed.

What changed at award

After award the builder holds the site, controls the sequence of trades, and is, in practice, the party positioned to complete what has been started — which is why the extreme version has a subject of its own: when a builder enters liquidation mid-build. "In practice" is deliberate: on work over the prescribed contract value where development approval is required, building indemnity insurance covers an owner, up to a regulated limit, for defective building work where the builder "dies, disappears (or is otherwise unable to complete the work) or becomes insolvent" (source: SA Law Handbook — Building Work Contracts).

The industry is blunt about what signing does. Writing for South Australian builders, under a heading covering the stage after signing but before work starts, the Housing Industry Association says: "Once you have signed the contract you have entered into a legally binding agreement. Any changes must be made strictly in accordance with the contract" (source: HIA — Dealing with delays). That is addressed to the builder; from the owner's side it says the same thing. The contract, not goodwill, is the instrument — which is why which contract you signed matters more after award than before. Comparing them beforehand is reading builder quotes, provisional sums and prime cost items.

Asking for the time claim and the cost claim apart

Treating a variation, an extension of time and a delay cost as one conversation is the most common error after award. HIA's guidance to builders is explicit that they are not one claim: "It is important to note that claim for any additional cost caused by the delay should be claimed separately as a variation" (source: HIA — Dealing with delays).

The boundary around that line matters as much as the line. It sits in a section describing a process HIA suggests rather than one the contract imposes: it says the HIA SA Building Contract for New Homes "does not prescribe a set process to put back the finish date", and that the causes at clause 11.3 are a non-exhaustive list. It also frames the entitlement itself, in a line addressed to the builder: "You are entitled to put back the finish date if you have been delayed in progressing the building work for reasons outside of your control". Both halves matter: the list of causes is not closed, and the entitlement that list serves is described by reference to causes outside the builder's control. Which of those a particular delay answers to, under your contract, is for your lawyer against your document.

Two further lines on that page are the most usable an owner has, because they are the industry body advising its own members. HIA "suggests each delay is dealt with separately, at the time that they arise", and warns that bundling delays into a single claim at the end of the job "is more likely to be disputed". And where the homeowner disagrees with a claim to put back the finish date, the first of the two options HIA names is not a dispute process at all. It is evidence: "Provide evidence to support your claim" — the builder's own records of the delay, plus economic information or correspondence from suppliers, which "may help convince the owner that the delay was not foreseeable at the time of signing the contract" (source: HIA — Dealing with delays).

So when time and money arrive fused in one email, ask for them apart: what event caused the delay, how many days are claimed, what records support it, and — separately — what cost is claimed under which clause. That is no more than HIA recommends its members provide.

What the written-variation rule does, and what it leaves out

The Law Handbook describes the most common pricing structure, a fixed price lump sum, as one where "The cost of the work is fixed, although the cost of some elements may vary depending on the actual cost. Variations sought by the owner must be agreed in writing". That bullet sits in a list of alternatives — rise and fall, where the price moves with the builder's actual costs and the completion date may be extended in certain circumstances, and cost-plus, where a capped margin is added to actual cost. The variation section adds a qualifier: "Usually the contract can only be varied if both parties agree in writing, although minor changes may occur without the owners consent" (source: SA Law Handbook). It also tells owners to read the contract to find out how it may be varied, and adds housekeeping that becomes leverage later: attach copies of variations to the contract.

The rule is a real protection, then, and not a universal veto. Where the ground differs from what was assumed, the first thing to establish is which mechanism the extra cost travels through: a variation you requested, or movement inside an allowance the contract already carries. That turns on how your contract is written, it is a question for your lawyer, and it is worth asking before you agree the change rather than after, because the two routes carry different rights. The site-condition side is covered in reactive clay and site classification.

What the payment rules give an owner, and what they do not

Under the Building Work Contractors Act, "A builder must not demand or request payment unless it is a genuine progress payment in respect of work already performed under the contract", and "The building owner is not obliged to make the payment in the absence of a written request by the builder for the progress payment". Read the whole of that section, because it runs the other way too: certain advance payments are authorised under the regulations — a deposit, capped by the regulations by reference to the value of the work, the building indemnity insurance premium, and third-party costs for professional services such as engineering, drawing or surveying (source: SA Law Handbook).

Whether a payment may lawfully be withheld or deferred, and what follows if it is, is for your lawyer against your contract, not something to settle on your own reading of that section. What the section gives an owner is the other direction: a request that is not in writing does not oblige payment, and a demand that is not for work already performed is a demand the Act does not permit the builder to make. So the practical work is records — each payment requested in writing, matched to work you can see, and filed. A payment position that has drifted ahead of the work is harder to bring back into line the longer it runs.

Whether a statutory payment timetable sits over your contract

A second payment regime sits in the background, and whether it touches your project is a threshold question for your lawyer. The Building and Construction Industry Security of Payment Act 2009 (SA) establishes an entitlement for parties to a construction contract to recover progress payments, on short statutory deadlines. But as a construction litigation team summarised the exclusions, "the SOPA does not apply in circumstances where the party receiving the benefit of the works resides in or proposes to reside in the premises the subject of the works (section 7(2)(b))" (source: Piper Alderman — Rising costs, payment difficulties and the SOPA, June 2024).

Two boundaries on that. The same page stresses the Act applies to most construction contracts, written or oral, and that this is one of several exceptions. And it is not written only for the party making a claim: two of its sections address the party receiving one — where an owner stands wherever the Act reaches their contract. A respondent "may respond to the payment claim with a payment schedule", and where the scheduled amount is less than the amount claimed the respondent "must provide their reasons as to why they do not propose making payment in full"; but a respondent who lets the response period run out without giving a schedule "become[s] liable to make payment of the amount set out in the payment claim (section 14(4)) as a debt due and owing" (source: Piper Alderman, June 2024). That window is short — set by the contract or by the Act, whichever expires earlier — and a suspension of works can follow shortly after a notice of intention is served. A notice under the Act must state on its face that it is made under the Act, which is the practical signal that a clock has started. So where the Act applies, the owner is typically the party receiving claims and the response is the lever. A missed schedule is not automatically the end of it: the same page records that before an adjudication application can be made the respondent must be notified of the intention to make one and given a further short opportunity to provide a payment schedule, and that a payment claim which does not sufficiently identify the construction work it relates to is open to challenge on that ground. Which of those is open on your facts, and within what time, is for your construction lawyer. What does not turn on the answer is where the position is actually held — in the response, not in the argument afterwards.

What the law puts into the contract whatever it says

The Act implies statutory warranties into every domestic building work contract. Among them: that the work will be carried out in accordance with accepted trade standards and according to the agreed plans and specifications; that the materials will be "good and proper"; that the work will be carried out in accordance with statutory requirements; that it will be carried out with reasonable diligence; that the house will be fit for human habitation; and that the building will be suitable for the purpose for which it is being built, as long as that purpose was made known to the builder. The diligence warranty is worth noticing in a programme argument, and the last one by anyone who told the builder at the outset what the building was for. The same section limits them: proceedings for breach must be commenced within a strict period after completion that cannot be extended, and the warranties pass to subsequent owners. Two protections also sit outside the drafting: relief may be sought in the Magistrates Court where "a contract contains terms that are harsh or unconscionable", and a contract "cannot purport to exclude the effect of the Building Work Contractors Act 1995 (SA)" — any term to that effect is void (source: SA Law Handbook).

The routes out, and what using them costs

Where an owner disagrees with a claim to put back the finish date, HIA points builders to two options: the evidence above, and conciliation — "You or the owner may initiate conciliation under the dispute resolution procedures of the contract" (source: HIA — Dealing with delays). That is the HIA SA contract's own procedure; what your document provides is a matter for your lawyer. Separately, an owner "can also contact Consumer and Business Services for help, which may assist in negotiations with the builder, or if necessary convene a conciliation conference under section 8A of the Fair Trading Act 1987 (SA)" — in a passage that first urges owners to raise problems with the builder early, since many resolve before they escalate.

Where the complaint is that work has not been done in accordance with the approved technical details and the Building Rules, an owner who can demonstrate a breach may apply to the Environment, Resources and Development Court for an order that the builder remedy it. In the first instance all such applications go to conferencing under the ERD Court Act, except where the matter goes to a building referee, who has the power of an arbitrator — so the first step is not a trial. Its powers run wider than making good the breach or paying compensation: it may order that a building or part of one "be altered, reinstated or rectified in a specified manner", or "grant any other remedy or relief as the Court thinks fit". The warning sits in the same passage: if the application is unsuccessful and the Court is satisfied the builder has not breached the Act, the applicant may be required to pay the builder for loss or damage and legal costs, and "An application for relief should not be brought lightly or without legal advice" (source: SA Law Handbook).

The same page describes two routes out of the contract itself that are easy to miss. There is a short window after signing in which a building owner may give the builder written notice of an intention not to be bound by the contract; and separately, the building owner "may also terminate the contract prior to completion if the builder has not complied with the relevant provisions of the Act". The Handbook attaches its own caution to both: legal advice should be sought first, "because there may be ramifications in relation to any unpaid work or legal costs incurred" (source: SA Law Handbook).

Nor does delay convert automatically into money in your favour. HIA notes that "The SA HIA building contracts do not include a liquidated damages clause. However, the owner may still be able to pursue you for damages if you do not finish on time" (source: HIA — Dealing with delays) — written to builders, in the pre-signing section on setting a realistic build period.

What to find out about your own project

None of the above tells you which of these your own contract preserved. These do, and all are answerable this week:

1. Which price basis did you sign — fixed price lump sum, rise and fall, or cost-plus?

2. What does your variation clause require — whose signature, in what form, before or after the work?

3. What does your extension-of-time clause list, is that list exhaustive, and does it require notice?

4. Is what you have paid still matched to work performed, or has it drifted ahead of the ground?

5. Where are your variation documents — attached to the contract, or scattered through email?

6. Did the contract itself meet the Act's requirements — in writing, signed by both parties, all terms set out, builder's details included, prescribed notice given? What a failure there opens up is for your lawyer.

Items four and five are the two that depend only on your own record-keeping.

Where Cyberate PM sits

The disclaimer above routes each question class to the professional who owns it: clauses and notices to your SA property lawyer, price and work-in-place to a quantity surveyor or building consultant, consumer and licensing questions to Consumer and Business Services, drawdowns to your lender or broker.

Cyberate PM does none of those. We do not price building work, value it, inspect it, certify it, or advise on your contract. We work owner-side: keeping the variation register, the payment position and the programme in one place, putting each proposed change in front of the right adviser before it is agreed rather than after, and making sure a claim for time and a claim for money are answered as two questions (what a development manager does; how that sits against the builder's own site management in project manager vs builder).

Common question

The builder says the delay was outside their control. Is that the end of it? Not automatically, in either direction. The standard form frames the entitlement as arising where the builder has been delayed for reasons outside their control, and treats clause 11.3's list of causes as non-exhaustive. HIA's own advice to builders is to support the claim with evidence and to raise each delay as it arises rather than bundling them at the end, so asking for the cause and the records is reasonable. Whether your contract's list is closed, and whether these facts meet it, is for your lawyer against your document.

Statutory requirements and standard contract forms are amended over time, and the terms of your own contract govern. Confirm the current position with your own adviser. Reflects publicly available material as at August 2026.

Sources

• SA Law Handbook — Building Work Contracts

• HIA — Dealing with delays (South Australia)

• Piper Alderman — Rising Costs & Payment Difficulties: Reminder of the Building and Construction Industry Security of Payment Act 2009 (SA)