If your builder becomes insolvent, you may need to consider your insurance rights, outstanding invoices, progress payments and options for completing the building work. Subcontractors may also need to consider recovering materials or equipment, lodging payment claims and enforcing any available security. Acting promptly can be important to protect your rights and financial position.
What should you do if your home builder becomes insolvent?
Our Commercial Team explains
Summary
What should homeowners consider if their builder becomes insolvent?
If your home was being built by Builton when it collapsed, you will need advice about:
- your rights under Builton’s home indemnity insurance policy with QBE;
- whether you need to pay unpaid invoices;
- whether you can claim back progress payments already paid;
- what other claims you can lodge with Builton’s liquidator;
- whether and how you can engage a new builder to complete the build;
- whether and how you can engage subcontractors on site to finish the work they have started;
- how to protect yourself against any payment claims that Builton’s liquidator may make against you.
What should subcontractors consider when a builder becomes insolvent?
If you were a subcontractor doing work for Builton at the time of its collapse, you will need advice about:
- taking back materials, plant and equipment left on a work site;
- claiming payments from Builton’s liquidator;
- continuing the job you have started, under a contract with a new builder;
- dealing directly with the owner on site; and
- identifying and enforcing any security that may entitle you to be paid ahead of other creditors.