Attach the building plans and specifications to the ACT building contract, identify the features that matter most to you, and specify agreed inclusions so they cannot change without your agreement. The contract should explain how variations to plans, specifications, extensions of time and costs are processed; always obtain variations in writing, and most contracts require both parties to sign them. According to the ACT Government’s City and Environment Directorate – Planning guidance, residential building work valued over $12,000 carries statutory warranties even if the contract does not state them (figures checked 1 October 2026).
What should an ACT building contract identify?
ACT legislation does not require a written contract for residential building work, but the Government guidance strongly recommends one. A written contract records the parties’ binding rights and responsibilities and helps them agree on costs, timeframes and expectations.
The guidance says the contract should cover:
| Contract area | What the contract should identify |
|---|---|
| Parties and site | The exact names of the homeowner and builder, the work address, the contract date and both parties’ signatures |
| Scope of work | A detailed description of the work, with the building plans and specifications attached |
| Important features | The work features and inclusions most important to the homeowner |
| Approvals | Who is responsible for obtaining relevant approvals, including a development approval where required |
| Price | The contract price if known, or clear explanations of costs that are unknown or subject to change |
| Time | The start date, completion date and final handover date, including reasonable allowances for obtaining approvals |
| Variations | A clear process for changing plans, specifications, costs and time |
| Payments | The work stages and amounts due under the progress-payment schedule |
| Licence and insurance | The builder’s licence details and any insurance policies held by the builder |
| Completion and defects | When practical completion occurs, the maintenance or defects-liability period and each party’s obligations |
| Problems and termination | Dispute-resolution procedures, termination rights and the obligations that apply when the contract ends |
If the builder uses an industry-association standard contract, check any special conditions carefully. Make sure you understand the clauses and the protections you are receiving before signing.
How do I lock in products, finishes and work features?
Tell the builder what you want and need, then decide the important items before signing. If requirements are left unstated, the contract may allow the builder to change room dimensions or substitute products that you do not accept.
| Feature | What to specify in the contract |
|---|---|
| Plans and specifications | Attach them and identify the features most important to you |
| Room dimensions | State the agreed dimensions rather than leaving them open to alteration |
| Tapware | Identify the required quality |
| Cornice | Identify the particular cornice to be used |
| Paint | Identify the required paint or paint colour |
| Smaller inclusions | Specify them too, even if they are minor items |
The inclusion should be clear enough that it cannot be changed without your agreement. Identifying these decisions before signing may also avoid extra costs associated with changing the contract during construction.
How should the contract process variations?
A variation can change the final cost and may affect the construction programme. The contract should state what happens when either party wants to change the plans, specifications, time or cost, as well as what happens if a change arises from local-law changes, plan errors or changes in goods supply.
| Variation issue | What the contract should make clear |
|---|---|
| Owner-requested variation | How a request is made in writing and how it affects price, time and the final cost |
| Builder’s response | The circumstances in which the builder may refuse a requested variation |
| Plans and specifications | How changes to the attached documents are processed |
| Extension of time | How an extension is requested and granted, and how it affects completion or handover |
| Costs | How additional costs are calculated and incorporated into the final account or progress payments |
| Builder’s margin | When the margin applies and how it is calculated |
| Local-law changes | How required changes arising from changes in local law are handled |
| Plan errors | How an error in the plans leads to a variation |
| Changes in goods supply | How supply changes are assessed and treated |
| Signing | Whether each variation must be signed by both parties |
Always obtain any variation in writing. Most contracts also require variations to be signed by both the homeowner and the builder, so check the relevant clause rather than assuming that a verbal instruction or separate conversation is enough.
How are variation costs and delays treated?
A builder’s margin is essentially the builder’s fee. The percentage in the contract applies only in specified circumstances, such as variations or termination, and is used to calculate the amount added to other costs.
The Government guidance provides this worked example:
| Item | Amount or effect in the worked example |
|---|---|
| Builder’s margin in the contract | 18 per cent |
| Additional goods cost | $1,500 |
| Resulting construction delay | 3-day delay |
| Margin applied to the additional goods cost | $270 |
| Total cost of the bathroom fittings | $1,770 |
| Contractual payment treatment | The builder may add the margin and goods cost to the next progress payment |
These figures illustrate how one contract works; they are not a prescribed ACT percentage for every building contract.
The contract should also state whether it compensates either party for delay. The guidance says contracts generally contain delay-compensation terms for the builder. If compensation for construction delays matters to you, raise it with the builder and obtain independent legal advice before signing.
What should be settled before the contract is signed?
Before proceeding, check that:
- You understand every clause, obligation and right in the contract.
- The attached plans, specifications and listed inclusions match what you agreed with the builder.
- The variation and extension-of-time processes explain how changes will be assessed.
- You have obtained independent legal advice about uncertain terms or proposed additions and changes.
- You have considered the independent legal and financial advice recommended for a building contract.
- You are ready to sign and have a copy of the signed contract as soon as possible.
The ACT has no mandatory cooling-off period for building contracts. Signing before you are ready may mean that you cannot change your mind without a penalty under the contract.
How do warranties and insurance fit the contract?
The contract should state the builder’s licence details and any insurance policies held by the builder. It should also provide fair termination rights if required project insurance or a fidelity fund certificate cannot be obtained within the prescribed time.
| Protection | ACT guidance |
|---|---|
| Statutory warranties | Residential building work valued over $12,000 carries statutory warranties even if the contract is silent |
| Warranty scope | Statutory warranties apply to the residence, but not to items such as paving, fences, retaining walls, outdoor swimming pools, ponds and antennas |
| Warranty periods | Structural and non-structural building elements have different warranty periods |
| Required project cover | For work over $12,000 on some residential buildings, the builder must have residential building work insurance or a fidelity fund certificate before work starts |
| Homeowners warranty insurance | This covers only up to $10,000 for deposits and is not residential building work insurance under the Building Act 2004 |
A contract may provide additional warranties and defect-resolution processes, but those additional warranties do not limit the statutory warranties.
Insurance requirements depend on the particular policy and project. This article is general information, not financial or legal advice. Check the ACT Government regulator page and the relevant policy’s PDS before relying on insurance cover or deciding whether a contract provides adequate protection.
Sources
FAQ
Do I need a written contract for residential building work in the ACT?
ACT legislation does not require a written contract, but the Government guidance strongly recommends one. A written contract records the binding rights and responsibilities of both parties and helps prevent uncertainty about costs, timeframes and expectations.
Will attaching plans and listing products prevent unwanted substitutions?
Attaching the plans and specifications and listing the important products, finishes, dimensions and other features gives the contract a clear record of the agreed work. The guidance says inclusions should be specified so they cannot be changed without your agreement.
Must an ACT building variation be in writing and signed?
Always obtain the variation in writing. Most contracts also require it to be signed by both the homeowner and the builder, so the variation clause should make that requirement clear.
Can a builder refuse a variation request?
A builder may refuse a requested variation in circumstances prescribed by the contract. The contract should explain the variation process, including when a refusal may occur and how changes to cost and extensions of time are handled.
Does the $12,000 statutory-warranty threshold cover every part of a building project?
No. Although residential building work valued over $12,000 carries statutory warranties, those warranties apply to the residence rather than items such as paving, fences, retaining walls, outdoor swimming pools, ponds and antennas. Check the contract and the relevant insurance documents for the scope of other protection.
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