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The contract is the key to payment

Contract Solutions International [CSI] regularly assists painters in dispute avoidance and dispute resolution matters. Whilst CSI will always advocate a painter implements dispute avoidance ahead of dispute resolution measures, CSI equally recognise that the decision to go into dispute resolution mode is often one made through necessity rather than by choice.

Some companies work on the ‘she’ll be right mate’ philosophy, which traditionally was ok. However, nowadays that kind of ‘hand shake’ agreement is being honoured less and less, resulting in many painters not getting paid what they are duly owed, or worse, with some sadly going into liquidation as a consequence.

So what can you do to help yourself?

Working on the basis that prevention is better than cure, CSI have joined forces with the Master Painters and Decorators Australia [MP+DA] to help painters avoid losing money.

Often painters fall into the trap of saying, ‘I do not have a problem, so why do I need you?’

CSI respond to such comments by saying, “You do not buy car insurance because you ‘want to’ crash...

For the same reasons you buy car insurance ‘before’ you proceed to drive, so should you spend time getting a clear contract in place ‘before’ you proceed with the works.

All painters large and small should invest in having their own standard terms and conditions for tendering with potential clients. If the contract is signed based upon your terms then great. However, if the client insists on their terms and conditions applying (e.g. by way of their standard purchase order or subcontract agreement), then CSI always recommend you take the time to review and compare their terms with yours and to make amendments as appropriate, ‘before’ rushing to sign them.

After securing the contract, the next area of risk comes from all the impacts and events that happen during execution of the works.

CSI recommend all painters get into the habit of implementing good contract administration throughout the duration of the contract, from record keeping, photo taking and administering payment provisions to ensure timely payments, to dealing with variations and similar contractual issues which, if not dealt with appropriately, invariably cost you time and money.

On larger painting jobs you may be asked to work in accordance with their schedule or programme, which records access, durations and sequence of works. Here it is important to record any delays and/or disruptions caused by others outside of your control, to ensure you are granted extensions of time for completion of your works, as this will help you avoid incurring damages for late completion.

Closing of a contracts does not come without risk as this is often the time when never before reported defects and back charges are raised – the intention being to avoid payment of your final payment claim.

If you do find yourself in a payment dispute, then the Construction Contracts Act 2004 [the Act] is a powerful tool specifically designed to help trades like painters pursue their overdue payment, quickly and cheaply.

For more information or assistance in the above regard, please contact David Court, Managing Director of CSI on 08 9400 8500 or email david.court@csiexcel.com

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