Builder Cash Flow Problems

Hi guys, our builder is having some cash flow problems and we are still at the early stages of the $350k build. So the site has not been moving for almost couple of months now. He also admitted to me he has no money and wants me to make advance payments directly to the trade which I really don't want to. What are my options? Can we change builders based on this? Can we sue him later on for the difference if the new builder charges us $400k to take over the project? Thanks.

 

Is it a HIA contract? You need some advice on whether it's best to terminate contract now for non performance and access the insurance money to get another builder. The insurance money is generally enough money to cover the difference

If the build is in Vic then I would also call your consumer affairs department

Domestic building insurance and insolvency

 

What does is specifically say in contact for delay of building

 

Thanks West, very helpful. You are right it's a HIA contract. I would assume we can only access if he is bankrupt or dead. I don't think that is happening anytime soon.

Ricki, i had a look through, doesn't say much in regards to that. Only the part about liquidated damages when it's past the deadline in ten months time. It's amazing how much the contract favors the builder after reading through it.

 

I only have WA HIA contracts but there should be a section on how you can terminate the contract.
I definitely would not be paying anyone (him or his subbies) for work in advance.

 

Should read though it first lol
Famous last words. Lol

How much have you paid out already?
How much work has been done?

 

Also does your bank have to inspect at end of each stage before releasing each part payment?