The Importance of a Building Contract

Brought to you by Matheson.

Many homeowners will agree terms for a house renovation or building project with the builder by way of a simple letter agreeing the price.  However, you may not be aware that the Royal Institute of the Architects of Ireland (the “RIAI”) publishes standard forms of construction contract for use for construction projects which set out the key-terms of how the works will be carried out and the specific obligations of the builder.  There is a form of contract that is suitable to all types of domestic building projects – not just whole new houses but also substantial renovations and extensions.  The RIAI standard contract will protect you in two very important respects – time and money.

Time – the builder will be required to complete the works by a specific date.  Although this date can be extended in certain specific circumstances, if the builder does not finish by that date, the builder must pay you damages for the delay which can include rent for alternative premises and other expenses.  This is an effective way to avoid the builder ‘disappearing’ from site for periods of days or weeks and prolonging the build well beyond what was originally promised!

Money – you only pay the builder for works properly completed on site.  Advanced payments or ‘equal monthly instalments’ so commonly looked for by builders, are not allowed.  If the builder does not finish the works or does not carry out the works to the design and standard required, you are not out of pocket for those works.  This is the most effective way to ensure you get what you expect from the builder.

Your Architect plays a vital role under the RIAI contracts.  The Architect regularly visits the site throughout the build to ensure that your project is delivered in accordance with the agreed quality and design.  The Architect also certifies payments to be made to the builder to that you can be assured that you pay only what is properly due to the builder.

We would always recommend that you continue to engage your Architect throughout the building process and to enter into a formal contract with the builder.  Your Architect can provide the appropriate form of contract and advise you further on the benefits.

About the contributor

Matheson has one of the largest, most experienced partner led Construction & Engineering practices in Ireland advising the largest developers / sponsors,  funders, semi-state bodies, tenants, employers, contractors and designers in the state.

All images supplied by Matheson.

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