What's the first thing you should do when you receive a contract from a builder?
Some Subcontractors get they solicitor to read the contract but if you feel confident, you can do it yourself to reduce the legal costs.
When it comes to a default notice, I would always get my solicitor to read it and give me the correct wording as per the example below.
What to do if the builder is not paying.
In the event of non payment or late payment, you can issue a breach of contract notice to the builder and quote the relevant Clause and it is worded as follows:
- Under Clause 39.7 (a)(iv) of the contract, you are in default with the September invoice (as you were with the August invoice).
- Under Clause 39.8 I am serving you notice to show cause. I am giving you the required 7 days’ notice. If payment is not received in that 7 day period, I will have no option other than to suspend work – Clause 39.9.
- The next invoice will be much larger, what guarantees will you give us that we will be paid on time in the future?
Change clauses you don't like
- Any clauses you don't like such as Liquidated Damages, cross them out and initial the change.
- If you don't like the payment terms, cross them out and write in your own and initial the change.
The builder can only say no but quite often they don't.
There is no way I would sign a contract with Liquidated Damages as it leaves you open to abuse from the head contractor if he is that way inclined and while the majority aren't, you only need one bad builder to make your life a misery.