Building Contract - Variations/Extras

Although in the industry, I wanted to throw out two queries with relation to building contracts.

An extension is being built at the moment. Contactor is appointed, contracts signed, price agreed. the job is nearly finished and two issues have arisen though, allowing these queries to arise.

The first is, there are variations on the project. Is the term variation and extras the same? (This makes sense if you read the next part!)

The second item is: The builder has now finished the project. The client requested that additional works be done (during the project), one of which is the placing of some cables in the floor for some underfloor heating. The system worked prior to the laying of the floor finish, and now does not. There is either a product fault or damage to the cables. We would assume that this was a variation under the current contract, with variations being covered in the contract, but the builder is stating that it was an extra and nothing to do with the contract. He is looking to be paid to lift the floor, fix the problem and re-fit the floor, whereas I would have suspected that as it was part of the contract, or a variation to the contract that he is liable for this and to deal with this.

Thanks in advance

The important issue here is what form of contract is in use.

In the RIAI standard form, the term Variation is used but I think 'extras' is more of a colloqial term in the industry.

The implication of your email is that an 'extra' is done outside of the contract and therefore the builder is not responsible for the result. I doubt that would be the case.

I suggest that the issue is not a question as to whether the work is classified as a Variation or an 'extra'. It is more a question of what is the form of contract and what does it say about any changes / additions to the scope of works during the building phase.

If there is no contract in use, then there is no agreed mechanism for dealing with what is a fairly routine problem in building contracts. In such a case, a legal resolution is not practicable and both sides will need to put the goal of a practical resolution ahead of any principles that they feel they need to defend.

The contract used is not RIAI, but as good as, if not better, as it covers some areas that the RIAI one does not. It clearly deals with variations and notes that where varaitions arise they are to be priced and agreed and the paid for, based on the BOQ......etc The items were all agreed and the items will all be paid for. I just cant understand how the builder comes to this conclusion that one thing is under the contract and another is an 'extra' and therefore he does it under a seperate contract and will not make good unless he is paid for the work. Or am I wrong with my thinking!!!!

Tank said:

The contract used is not RIAI, but as good as, if not better, as it covers some areas that the RIAI one does not. It clearly deals with variations and notes that where varaitions arise they are to be priced and agreed and the paid for, based on the BOQ......etc The items were all agreed and the items will all be paid for. I just cant understand how the builder comes to this conclusion that one thing is under the contract and another is an 'extra' and therefore he does it under a seperate contract and will not make good unless he is paid for the work. Or am I wrong with my thinking!!!!

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tank,

what contract was it?? is it a proprietary type or specific to this job?

personally i would think that the fault needs to be diagnosed prior to the determination of cost cover.....

if the UFH is faulty then the contractors shouldnt carry costs to open and relay floor...
if the wires (or any installation by contractor) are the problem then he should have to cover costs of a substandard construction....

It is non-RIAI contract Standard Form/Building Contract utilsied by a technical architectal firm for all their projects. It is quiet clear and similar to the RIAI one. (Not pulled off the internet!). It seems to have been written up specifically for this contract.

My understanding is that, as this was done during the contract, it should fall to the builder to resolve it. (Again, I may be wrong here). The job is not practically complete, and therefore not handed over. Should it not be handed over fully operational, at no extra costs to the client. IE, should the builder not have to resolve the issue and make the claim against the manufacturer if the UFH is faulty?

It will depend on the wording of the Contract.

A properly drafted contract will provide that the usual warranties in relation to main project equally apply to the extras.

Also, the provisions of the Sale of Goods and Supply of Services Act apply.

You need to identify the cause of the fault - if attributable to the work of the contractor then he should fix it. If for example there is a problem with e.g. the cables that it not attributable to the main contractor (e.g. if the cabling was put in by a sub-contractor nominated by you) then it may be the case that the sub-contractor is responsible.

You need to refer this issue to the client's solicitor

A nominated subcontractor is contracted with the builder and not the client therefore the subcontractor is liable to the main contractor for the costs of defective work. The client is entitled to a finished product.
Nominations of subcontractors and suppliers is one of the most abused and misunderstood clauses of a building contract.
I would also steer clear of a solicitor's interpretation. It would be better to seek the opinion of an experienced architect or QS.

The solution in this regard is actually quite simple.

An "extra" is not a contractable term and is the indutry slang for a variation. A variation to a contract is part of the contract but must be ordered etc in accordance with the terms of the said contract.

If you dont use a standard form contract any anomolies and subsequent costs associated with these are the responsibility of the client / clients representitive who drew up the contract.

If the variation was ordered and the works carried out by the builder then it is his responsibility to sort it out. Was the builder instructed to carry out the works or was the builder instructed to facilitate a third party (ie who paid the UFH contractor)? If he was instructed to facilitate a third party then it will not be his responsibility.

Tank said:

The first is, there are variations on the project. Is the term variation and extras the same? (This makes sense if you read the next part!)

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Many terms out there - variation, extra, change orders etc. Your main issue to deal with is the issue below.

Tank said:

The builder has now finished the project. The client requested that additional works be done (during the project)...........

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Check the Bill of Qts & see if this was allowed for.
If not, then it more than possibly could be a variation/changer order i.e. the builder should be paid for it. I think you may have answered the question by using the words 'additional works'

If its not in the BOQ or the preliminary sums then most likely a variation, unless the QS did not allow for it.

If I asked a builder to tile my utility room even though it wasn't on the original plan and quote - that's an EXTRA.

If the builder went to renovate my bathroom as agreed only to find that the floor under the old bath is all rotten and needs replacing, that's a VARIATION to the original contract.

EXTRAS are wishes, VARIATIONS are necessities.

Yachtie said:

If I asked a builder to tile my utility room even though it wasn't on the original plan and quote - that's an EXTRA.

If the builder went to renovate my bathroom as agreed only to find that the floor under the old bath is all rotten and needs replacing, that's a VARIATION to the original contract.

EXTRAS are wishes, VARIATIONS are necessities.

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From a building contract perspective they are the same. If you have a contract in place all items added to the contract are "variations" to the contract and that is where it comes from.

Tank said:

There is either a product fault or damage to the cables.

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I think that is the only issue.

If it is product fault, then the supplier of the product should be liable.

Extending the product fault idea a little, to the product being unsuitable for the particular job, then I think the contractor should not be liable unless he chose the product, and you placed reasonable reliance on his expertise.

If it is damage to the cables, I cannot see the contractor escaping liability, and the question of the relationship between the installation and the main contract is a red herring. Either he installed the UFH badly, leaving him liable in relation to the "extra", or the finishing of the floor was not properly done, leaving him liable under the main contract.