ABIC Building Contract Simple Works or Major Works

We are building 4 townhouses, have selected a builder and are now looking at the Contract.

One Project manager and solicitor have said Simple and another project manager and solictor have said Major.

What has been the experiences of others and what type of contract was used for multi unit development.

Thanks

 

Small building works contract will suffice. I wouldn't use Major Works unless project value exceeds $5-10M and is to be administered by the architect, progress claims reviewed by a QS.

 

Hi Scott,

What do you mean by the project value?

1. Is it the builders cost plus land value
2. Total end product market value

We will not have be having the project administered by an architect but we will have a quantity surveyor involved.

What is the difference between the two? Any advantage or disadvantage with one over the other.

 

Project value = Construction contract

IIRC both contracts are written for administration by the Architect

One has a B Architecture the other a B Construction Economics. @Depreciator

 

I meant what is the difference between Simple Works and Major Works. I understand that Simple Works is for up to 3M and Major is for above this. And advantage or disadvantage in using a Major Works Contract for works of 2M . Thanks

 

I am using ABIC Simple works
That was what my architect recommended but I did not get a lawyer involved (stupid move I know).
2 townhouses and construction cost of $2m
There have been no issues with lending, etc with Simple Works
I don't know the differences between Simple and Major and relied on the advice of the Architect.

 

What shortcomings did you see in not getting your solicitor involved to review the documents pre-issuing to the tenderers?

 

I remember comparing the two and they are mostly the same. The major just had more things to sign off etc. However, when we approached our builder, he was adamant to go with the HIA contract. So make sure your builder has agreed to use one or the other.

 

The ABIC MBA/RAIA contracts are architect-administered. The question an not be answered, if you are not involving an architect as they are both principal administred.

A lot of people try to cut out the architect (they often think they are 'too expensive' But its not the case.

Ibrahim Conlon

 

you will (if not involving a principal to administer) using most likely the MBA contract suite

(not advisable as there is no one there to overlook progress of works, time, cost, quality (TCQ) which are the essentials of a contract).


When you are dealing direct to the builder it is inevitable you will head into a big, deep, dark storm. (variations, disagreements, issues with time delays, cost, quality).


The advice; ALWAYS USE A registered Architect (in each state) to administer the ABIC MBA/RAIA principal-administered contract. The architect is there to protect you, ensure efficient time delivery, reduce variations & cost blowouts and ensure quality of workmanship. Architects don't just draw 'pretty pictures' their KEY role is to administer the contract.

 

Did you have a Project Manager or Architect to administer the contract?

 

Was there any issues with the contract which a solicitor may have picked up ?

 

With your projects using Simple Works, who administered the Contract. Did you get your contract reviewed by a solicitor?

 

Architect administered, as the builder, I felt it was weighted towards the client (adjustment of PC sums).

I've not heard of getting it reviewed independently by a solicitor but getting the practice notes from RAIA ie the architect may be of some aassistance.

@KateAshmor may put her 2 cents on whether SBWC is a contentious contract and how much case law there is on this form of contract.

 

the ABIC MBA/RAIA contracts are the most fair & balanced contract suites available. If I may say-As an architect & contract administrator myself for many years and having knowledge & experience in all of the contracts available-I wills ay without doubt these are the best & fairest.

They are developed in CONJUNCITON with MBA (Master Builders Association) and RAIA (Australian Institute of Architects) so the contracts are fair and balanced for both parties. Although the roles are clearly defined and it is the architect administering the contract thereby reviewing all progress claims and time extensions and managing the retention fund.

These contracts may be viewed to protect the CONSUMER (client) -which essentially the original intention of a contract was developed for. A contract that protects only the builder-in all fairness, is not a particularly good contract to use. The MBA suit of contracts do such and I rarely recommend them except if a client (in all honesty) wants to take the cheap option and cut out the architect and deal direct to builder, hence steer their ship into a storm instead of away from the storm and icebergs. You get what you pay for.

What we find though is that builders do not like working with an administer nor having a retention fund. Both which are there to protect the consumer; Protect the time, cost and quality and thereby reduce overall risks and keep things as smoothly-run as possible. But I must conclude that I have always felt a kind for sorry for poor old builders. No other business or trade has such control and regulation watching their every move.

 

MBA contracts are a joke, far too lenient towards the builder. Can't weigh in on the others - will have to take a look at the ABIC one next time.

 

Well I cannot say the MBA contracts are a joke; the MBA is a professional organization.

However-the MBA suite cuts out the architect as administrator thus client is dealing direct to builder. Thus NO independent professional inspecting works progress, time, cost, quality.

For very small projects such as carports/pergolas-then it may be ok to deal direct to head contractor under MBA contract. But I would NEVER advise client to deal direct to builder.

Why?

A builder is there to make money and build as quick as possible. I cannot state that builders have intention to make insufficient quality works or make delays or push for variations-but these three(3) important issues become more easy to occur if dealing direct to builder.

Paying 8-10% for an architect to (a) inspect the works as they progress, (b) managing progress claims & certificates of completion & retention (typically 5% per progress claim)-is well worth it.

 

The alternatives being the old PWC 3 contract(replaced by the Aust Standard contract), AS2124 (1992) and AS4000

PWC 3 was very client-oriented, so is AS2124. AS4000 leans back towards the builder.

 

Architect

 

Does anyone know whether the ABIC contract can be used and self manage but employ a quantity surveyor for payments.