Builder non-contactable, concerns on finances

Unfortunately what should have been a simple Granny Flat build has turned into a long drawn out affair.
Sorry for long post but I will try and cover all relevant facts.

Request: suggestions from the forum on next action steps I might not have considered

Facts: Fully compliant auxiliary unit under construction in Qld. Council approved, QBCC build contract, insurances provided.
I am interstate.

Timeline: The build was slow to commence due to seperate tenant issues in existing property (front house) not related to the GF build.

Once underway had deposit, then slab and frame stages completed in reasonable timeline.

Some delays due to roofers but tiles are up, doors & windows in, bricks delivered on site but not ‘installed’.

Builder is small and I have one contact, trying the office number also is same person’s voicemail.

Since late April /early May work has stopped.
The builder has been unwell & in hospital (believe this is true) but has had reducing response times (red flag).

Contract payments are up to date / paid promptly for frame stage.

Despite multiple promises brickies have been delayed / let me down etc still no movement to complete lock-up.

Actions so far: 2 weeks ago spoke to lawyer and on advice have issued email and text communication (their exact email content) approx 2 weeks ago advising ‘essential date’ of completion in 65 days. (Sorry if this terminology is not 100%). Would then give me options if not completed by then.

This action was chosen as believe would always be easier to complete rather than QBCC and other builder to complete the project.
Builder called after receiving this email advising they would email next day and brickies on site by that weekend, but no further contact received since. (2 weeks ago).

Advised yesterday from well respected PM that a couple of trades had knocked on door of existing (front) house tenants looking for builder for payment (massive red flag). They had referred to PM and hence my notification from PM yesterday.

Builder still has current licences, no outstanding notices on their build licence. Note build licencee name is different to the builder doing the work.

I have continued to try and contact builder without success. Aware of Brisbane lockdown.
I expect that no further action will take place if builder is on verge of going bust, is there further steps that I can do / action before the ‘essential date’ takes place to assist in getting work completed?

Will seek further legal advice but wondering if some obvious next steps that could be suggested that I can’t see due to missing the forest for the trees.

And helpful suggestions are greatly appreciated, thankyou

 

Bump for any suggestions from the experts please?

 

Post details on tradie mayhem FB site and you'll find the people who are owed money in minutes! Tradies know what's up when someone isn't paying bills. The company I work for lost money on liquidation of a company 2 years ago. The concreter rocked up with a shotgun and magically $500k was paid the next day. My boss wasn't so keen and we lost 100k.

 

Legal advice on the QBCC process would be wise. Sounds like a high risk of non-completion so working with that process will help

 

Not too bright in the first place to allow his debtors to blow out to $500k even if that was one month's supply - I would have moved to weekly on sums like that and then stop credit.

 

Thanks @Clean Cookie - having a quick look it’s a private (closed) group.
Do you need to be a trader to join? As this would be my only query, so don’t want to pretend to be a trader when I’m not.

Thanks

 

Thanks Paul, that what I’ve been looking at and looks like the most likely way to complete. Unfortunately it will require cancelling and getting another builder to complete which I expect will be messy.

Just checking if there were any other handy tips from the experts that I might have missed.

 

Plenty of posts here on the need for patience I'm afraid.

QBCC seem to allow a lot of time before they will allow site handover and completion. Importance too that the contracted builder be allowed to complete, or not, and limiting site access can end in frustration on their part not a failure of builders part. ie they will blame you. That wont be insured so take care. Dont pay a cent without legal advice and the usual issue is they will tell you they need more $$$ and then take it and you wont have any extra work performed. Many builders cant manage "work in progress" and take the progress claim $$$ and leave a unfinished job for more than the value that is unpaid...a lot more. Eventually it all catches up. Until the entity declares insolvency it is a waiting game. Then after that a administrator or liquidator will consider if they can offload some of the work (sale) and when a report is issued to creditors etc then QBCC will make choices. Your solicitor may seek to push a determination in a lower court that the entity cant meet its debts as and when they fall due. This can push it over the start line...but its a long process.

You dont want to cancel contracts. You want them to be unable to fulfill it due to insolvency

 

Update: for those interested.
QBCC approved claim and now have new build contract signed with new builder.
Result was due to higher costs there was a shortfall which QBCC are covering,
The balance of original build contract outstanding is still payable to new builder.
Fingers crossed all complete in approx 5 -6 months.
Understand through the grapevine that QBCC are now pursuing the original builder for the $ paid out under insurance.

Silver lining: indicated rental has jumped significantly, so when complete the return should be better than initially planned.

 

Further updates on this slow progress / saga (warning bit of a long read):

Initial certification had been incorrectly submitted by certifier (appointed by initial builder) as a secondary dwelling instead of auxilliary dwelling.
Unable to amend / correct so required to resubmit.
Council contribution fees meanwhile increased from $7k to $16k.
No leeway given despite application / request.

To then submit again certifier wanted site inspection plan / certifications so far.
Engineering found, termite not, site not done by original builder.
Site plan then found slab and works completed to date had been constructed too close to actual boundary.
DA application now required for more cost and delays.

New builder is helpful in tracking down what they could but couldn’t find the pest installer.
When looking at cost to install termite barriers and very luckily initial termite installer called up out of blue for a 12 month inspection. Provided the certification documents and inspected the ‘site’.

Forward to late Feb 2023 and now DA approved (thankfully) and hit with cost increase of $20k given approximate 9 month delays.
Builder explained understood if went elsewhere but I believe other builder costs to complete would be similar so accepted to get this thing completed.

April 2023 - bricks now up after sitting in yard for over a year and property now at lock up stage.
Looks good apart from the yard continuing to grow crazy.

Fair way to go yet but at least now seeing progress / movement towards completion.

 

Minor win - since Queensland government granny flat law change from late 2022, DA was then submitted as an secondary dwelling therefore saving the $16k in infrastructure charges as the state law enabled seperate renting.

Sought legal advice which confirmed this ability would remain with the property as per the planning laws in place at time of approval despite council’s concern to try and encourage those to pay the infrastructure charges.

Note as per seperate thread (see link) this opportunity has now closed and the infrastructure charges have increased even higher for all GF’s to I understand approx $23k (tbc).

Logan council changing infrastructure charges for Granny Flats effective 6th March 2023

 

Thankfully all framing had been wrapped and roofing had been completed so (touch wood) should be ok there.
Getting there!

 

May 2023 update - stuck waiting for a bank letter.

Reached lock up stage and funds paid from insurance pay out.
Builder needs letter confirming bank acceptance of new builder and funding for the builders insurance.

No change to $ outstanding or loan, just the builder.
Bank decides needs valuation - 2 week delay.
Valuation report completed 2 weeks ago - still waiting.

Meanwhile no work progresses.

 

What's the bank saying about the situation?
2 weeks since valuation completed, do you know if the val report came back ok?

 

Waiting and report came back with higher valuation.

 

That's a good sign but still seems to be taking too long IMO, hopefully you get an answer soon.

 

Update on the long running saga, build now slowly progressing, fixing stage 1 completed and now starting waterproofing internal fit-out / cabinetry etc.

 

For anyone recalling this long running saga, the granny flat has finally been completed and has been quickly rented out at $500 / week.

Great rental compared to my initial calcs but a long time and challenging road to get there!