Choosing contracts

Selecting the right building contract for your project can be critical to its success.

The type of contract you use will depend on the size and complexity of the project; however, the contract must comply with any legislative requirements. We strongly recommend using a standard form contract, such as one of Master Builders' contracts.

Master Builders' wide range of commercial contracts, residential contracts and subcontracts are available exclusively to members and have been specifically tailored for the building and construction industry. Each contract allocates risk fairly, outlines obligations in detail, and complies with legislative requirements.

Refer to the contract matrix for a full list of Master Builders contracts.


Commercial contracts

If you carry out building work in Queensland, you must comply with the Queensland Building & Construction Commission Act 1991.

The Act requires that contracts for building work must be in writing. This includes head contracts, subcontracts and sub-subcontracts. For projects valued at more than $10,000, a written contract must be signed before building work commences, and for projects valued at $10,000 or less, a contract must be signed before the building work is finished.

To comply with the QBCC Act, the following items must be in writing:

  • Scope of building work
  • When building work is to be completed or, if appropriate, how the date is to be worked out
  • Amount to be paid or, if appropriate, how the amount to be paid for carrying out the building work is to be worked out
  • Parties’ agreement about retention amounts and securities held
  • Name of building contractor who is the contracted party for the building contract
  • Licence number of building contractor who is the contracted party for the building contract, and
  • Address of the land where building work is to be carried out.

The type of contract you use for your building work will depend on the size and complexity of the project, and must comply with Act requirements. We strongly recommend using a standard form contract, such as one of Master Builders contracts.

Commercial contracts include:

Commercial Building Contract

A Commercial Building Contract is a lump sum contract to be used for the construction only of commercial building work with or without a Principal's agent.

Purchase the Commercial Building Contract from the eShop, visit your local Master Builders office to purchase contracts over the counter or complete your contracts online via eDocs.

Special conditions addendum

A Special Conditions addendum for the Commercial Building Contract is now available to take care of the changes required for contracts you sign from 1 July 2018 onwards.

If you’ve purchased a hardcopy Commercial Building Contract from us that doesn't contain the Special Conditions addendum, download a copy of the relevant Special Conditions addendum. In the ‘Special Conditions’ item of your contract, you’ll also need to include the following wording: ‘Refer to Addendum - Special Conditions, for details of SC1 to SC2’ etc.

Minor Works Contract

The Minor Works Contract is a lump sum contract for minor commercial work up to the value of approximately $100,000; however, it can be used on projects of a greater value where the work is simple and does not include many trades. It can be used by contractors when contracting directly with the owner.

Purchase the Minor Works Contract online via eDocs.

Cost Plus Contract

The Commercial Cost Plus Contract is for use on commercial projects where the contract price cannot be reasonably estimated at the time the contract is being entered into. For example, on major alterations or extensions, where the cost of a substantial part of the work cannot reasonably be calculated without some of the work actually being carried out. In this case, a Cost Plus Contract can be used to give a fair and reasonable estimate, and payment is based on the actual cost of the project plus  an allowance for the supervision and/or profit/overheads (fixed fee or a fixed percentage).

It's important to note that this type of contract can be more adversarial in nature, as trade and supply progress claims may be scrutinised by the owner. Under a Cost Plus Contract, the owner is entitled to receive copies of all invoices in relation to expenditure on the project; so, when entering into a Cost Plus Contract, it is important to maintain a very high standard of contract administration. There are other significant differences between a Cost Plus Contract and a lump sum contract.

You should phone Master Builders for advice, before using a Cost Plus Contract.

Purchase the Cost Plus Contract online via eDocs.

Special conditions addendum

A Special Conditions addendum for the Commercial Cost Plus Contract is now available to take care of the changes required for contracts you sign from 1 July 2018 onwards.

If you’ve purchased a hardcopy Commercial Cost Plus Contract from us that doesn't contain the Special Conditions addendum, download a copy of the relevant Special Conditions addendum. In the ‘Special Conditions’ item of your contract, you’ll also need to include the following wording: ‘Refer to Addendum - Special Conditions, for details of SC1 to SC2’.

Supporting documents

Throughout the construction period, a range of documents must be used to support the head contract agreement.

Before you sign a contract, you may choose to use a Director’s Guarantee to protect you should the owner fail to pay.

Once a contract is in place and work has begun, it is important to document (in writing) any changes to the contract, no matter how minor, including variations, extensions of time and requests for information.

Director’s Guarantee

A Director’s Guarantee is a secondary agreement that provides additional risk management for contractors in circumstances where the owner's capacity to pay is uncertain. Under a Director’s Guarantee, an individual (usually the Director of the company) assumes responsibility for the debts of the company in the event of payment default.

Confirmation of Variation/Instruction

A variation is a change to the contract, such as an addition to or reduction in the scope of work that may result in an increase or decrease in the contract value.

While the Queensland Building and Construction Commission Act 1991 doesn't require that variations to commercial contracts are put in writing, Master Builders strongly recommends that the contractor has a signed variation in place before the work commences.

Failure to fully and accurately document variations to the original contract in writing is a frequent cause of disputes.

Master Builders Confirmation of Variation/Instruction is used to confirm variations or instructions that affect the scope of work.

Extension of time

The Extension of Time form should be used to confirm any extensions of time that will affect the project completion date, due to a delay as allowed for in the contract.

It may be useful to refer to Master Builders extension of time construction period calendar, when calculating the revised completion date.

Request for information

As the name suggests, a request for information should be used to request information from the owner, for example where there is a discrepancy in the documentation or specific information is required.


Residential contracts

If you carry out residential building work valued at more than $3,300 in Queensland, you must comply with Schedule 1B of the Queensland Building and Construction Commission Act 1991 (QBCC Act) .

The Act requires you to have a written contract with your clients and to give them a signed copy and a QBCC-prepared Consumer Building Guide before signing the contract.

The type of contract you use for your building work will depend on the value of the project. If the value of the construction work is more than $3,300 but less than $20,000 (including GST), then you must have a Level 1 Regulated Contract in place prior to commencing the work.  If the value of the construction work is more than $20,000 (including GST), then you must have a Level 2 Regulated Contract in place prior to commencing the work.

The contract you use must comply with requirements set out in the QBCC Act. We strongly recommend using a standard form contract, such as one of Master Builders contracts.

Master Builders' wide range of residential contracts are available exclusively to members and have been specifically tailored for the building and construction industry. Each contract allocates risk fairly, outlines obligations in detail, and complies with the requirements set out in the QBCC Act.

Residential Building Contract - Level 2

The Residential Building Contract is a lump sum contract with a value of work $20,000 or more, to be used for new houses, duplexes or major residential works, including extensions and alterations. It is a contract between a contractor and residential owner. It is also suitable for use when an architect is acting as an agent on behalf of the owner.

The commentary on Master Builders Residential Building Contract gives an in-depth explanation of each item in the Residential Building Contract, and explains exactly how to fill out each part of the contract.

You can purchase the contract from the eShop, visit your local Master Builders office to purchase contracts over the counter or complete your contracts online via eDocs.

Special conditions addendum

A Special Conditions addendum for the Residential Building Contract is now available to take care of the changes required for contracts you sign from 1 July 2018 onwards.

If you’ve purchased a hardcopy Residential Building Contract  from us in the past 12 months, download a copy of the relevant Special Conditions addendum. In the ‘Special Conditions’ item of your contract, you’ll also need to include the following wording: ‘Refer to Addendum - Special Conditions, for details of SC1 to SC2’.

Residential Renovation Contract – Level 2 

The Residential Renovation Contract is a lump sum contract to be used for large residential renovation or alteration works with a value of $20,000 or more. It is a contract between a contractor and residential owner.

You can purchase the contract from the eShop, visit your local Master Builders office to purchase contracts over the counter or complete your contracts online via eDocs.

Special conditions addendum

A Special Conditions addendum for the Residential Renovation Contract is now available to take care of the changes required for contracts you sign from 1 July 2018 onwards.

If you’ve purchased a hardcopy Residential Renovation Contract  from us in the past 12 months, download a copy of the relevant Special Conditions addendum. In the ‘Special Conditions’ item of your contract, you’ll also need to include the following wording: ‘Refer to Addendum - Special Conditions, for details of SC1 to SC2’.

Minor Works Contract – Level 1 – Residential

The Residential Renovation Contract is a lump sum contract to be used for large residential renovation or alteration works with a value of less than $20,000. It's a contract between a contractor and residential owner.

You can purchase the contract from the eShop, visit your local Master Builders office to purchase contracts over the counter or complete your contracts online via eDocs.

Special conditions addendum

A Special Conditions addendum for the Minor Works Contract is now available to take care of the changes required for contracts you sign from 1 July 2018 onwards.

If you’ve purchased a hardcopy Minor Works Contract from us in the past 12 months, download a copy of the relevant Special Conditions addendum. In the ‘Special Conditions’ item of your contract, you’ll also need to include the following wording: ‘Refer to Addendum - Special Conditions, for details of SC1 to SC2’.

Trade Contract – Level 2

The Trade Contract is a lump sum contract for use by a trade contractor when contracting directly with a residential owner. The Trade Contract is recommended for use by trade contractors when undertaking a specific trade (i.e. bricklaying, landscaping, concreting or plumbing).

A Trade Contract shouldn't be used in place of a subcontract.

You can purchase the contract from the eShop, visit your local Master Builders office to purchase contracts over the counter or complete your contracts online via eDocs.

Basic Works Contract

The Basic Works Contract is a lump sum regulated contract to be used for work performed on a detached dwelling, including a single duplex, or the renovation, alteration, extension or repair of a home, or removal or re-siting work for a detached dwelling where the contract price is up to $80,000 (GST inclusive). It is a contract between a contractor and residential owner.

You can purchase the contract from the eShop, visit your local Master Builders office to purchase contracts over the counter or complete your contracts online via eDocs.

Special conditions addendum

A Special Conditions addendum for the Basic Works Contract is now available to take care of the changes required for contracts you sign from 1 July 2018 onwards.

If you’ve purchased a hardcopy Basic Works Contract from us in the past 12 months, download a copy of the relevant Special Conditions addendum. In the ‘Special Conditions’ item of your contract, you’ll also need to include the following wording: ‘Refer to Addendum - Special Conditions, for details of SC1 to SC2’.

Simple Works Contract

If the cost of building work exceeds $3,300, it must be covered by a regulated building contract. However, irrespective of the value of work, a written contract is always preferred to a verbal agreement.

The Simple Works Contract is a one page contract for use when dealing direct with a client for residential building work where the contract value is less than $3,300.

You can purchase the contract from the eShop, visit your local Master Builders office to purchase contracts over the counter or complete your contracts online via eDocs.

Pool Building Contract – Level 2

The Pool Building Contract is a lump sum contract for use in the construction of a swimming pool or spa, with a value of work $20,000 or more and when contracting directly with a residential owner.

If a pool is being built as part of a residential project (such as a house or duplex) for a contractor, then a subcontract should be used.

You can purchase the contract from the eShop, visit your local Master Builders office to purchase contracts over the counter or complete your contracts online via eDocs.

Special conditions addendum

A Special Conditions addendum for the Pool Building Contract is now available to take care of the changes required for contracts you sign from 1 July 2018 onwards.

If you’ve purchased a hardcopy Pool Building Contract from us in the past 12 months, download a copy of the relevant Special Conditions addendum. In the ‘Special Conditions’ item of your contract, you’ll also need to include the following wording: ‘Refer to Addendum - Special Conditions, for details of SC1 to SC2’.

Cost Plus Contract – Level 2 (Residential)

The Cost Plus Contract (Level 2) isn't a lump sum contract. It is a cost plus regulated contract to be used for construction of a detached dwelling, including a single duplex, or the renovation, alteration, extension or repair of a home, or removal or re-siting work for a detached dwelling where the estimated total contract price is equal to or greater than $20,000.

You can purchase the contract from the eShop, visit your local Master Builders office to purchase contracts over the counter or complete your contracts online via eDocs.

Special conditions addendum

A Special Conditions addendum for the Residential Cost Plus Contract is now available to take care of the changes required for contracts you sign from 1 July 2018 onwards.

If you’ve purchased a hardcopy Residential Cost Plus Contract from us in the past 12 months, download a copy of the relevant Special Conditions addendum. In the ‘Special Conditions’ item of your contract, you’ll also need to include the following wording: ‘Refer to Addendum - Special Conditions, for details of SC1 to SC2’.

Supporting documents

The Queensland Building and Construction Commission Act 1991 Schedule 1B sets out specific requirements for the administration of a contract, including a range of documents that must be used to support the Contract.

Before work commences and even before you sign a contract, you may be required to perform preliminary tasks on behalf of the owner. This preliminary work should be covered by a Preliminary Agreement.

It's also important to ensure the engineer engaged to conduct soil classification and design the footings and slab system signs an Engineer Specification & Confirmation, and that the owner is supplied with a copy of the Foundation Maintenance and Footing Performance: A Homeowners Guide.

Once a contract is in place and work has begun, it is important to document (in writing) any changes to the contract or administration matters, including variations, extensions of time, requests for information and progress payments.

At Practical Completion, you will need to give the owner a Practical Completion Notice and Defects Document.

Preliminary Agreement

The Preliminary Agreement is for use when performing preliminary tasks on behalf of the owner, prior to a contract being signed, including plans, site survey, soil test and building approvals. Be aware however, that you may attract liability for the design you provide under a Preliminary Agreement. For more detailed information, contact Master Builders.

Engineer Specification & Confirmation for Residential Footing & Slab Design

This document should be provided to the engineer engaged to conduct soil classification and design the footings and slab system. Do not sign a contract with an owner until the engineer has signed the Engineering Specification document, especially when the owner engages the engineer.

The Queensland Building and Construction Commission (QBCC) requires all contractors to have written confirmation from the engineer that the engineer has complied with the QBCC Policy Specification – Master Builders Engineer Specification & Confirmation for Residential Footing & Slab Design ensures this.

Without this document, contractors are exposed to the total cost of rectification in the case where a footing and slab system fails through subsidence or settlement. In other words, the Engineer Specification and confirmation ensures the no-fault provisions under QBCC’s Home Warranty Insurance Scheme are met.

Foundation Maintenance and Footing Performance: A Homeowners Guide

Many problems relating to footing performance are caused by the subsequent actions of owners, after the construction period has ended (particularly in relation to site drainage and landscaping).

The Foundation Maintenance and Footing Performance: A Homeowners Guide describes many of the causes of problems and gives owners advice on foundation maintenance and footing performance.

You must give a copy of the guide to the owner to help them comply with the QBCC Subsidence Policy. Upon receiving the guide, the owner must sign the Declaration by Owner (BTF18).

Residential Building Specification

The Residential Building Specification is an important companion document to the Residential Building Contract. It is for use on residential projects to specify detailed information of the work to be carried out, including trade works, colour/style selection and paint.

Consumer Building Guide

The Act requires that contractors performing residential building work must give their clients a QBCC-prepared Consumer Building Guide for contracts $20,000 or more in value.

The Consumer Building Guide must be given to the owner before signing a contract, along with a copy of the contract. It gives home owners general information about the contract, such as the rights and duties of the owner and contractor, information about the cooling-off period and procedures for resolving disputes.

Confirmation of Variation/Instruction

A variation is a change to contract, such as an addition to or reduction in the scope of work that may result in an increase or decrease in the value of the work. Failure to fully and accurately document changes to the original contract in writing is a frequent cause of disputes.

The Act requires that all variations, no matter how small, are put in writing and agreed to by the Owner before work commences, unless the work is required urgently and it is not practical to produce a variation document before work commences.

The owner must be provided with a copy of the variation document within five business days of when the variation was agreed to.

Master Builders Variation Notice is used to confirm variations or instructions that affect the scope of work.

Extension of Time

The Extension of Time Claim form should be used to confirm any extensions of time that will affect the project completion date, due to a delay as allowed for in the contract.

It may be useful to refer to Master Builders extension of time construction period calendar, when calculating the anticipated completion date.

Request for Information

As the name suggests, the request for information should be used to request information from the owner, for example where it is necessary to confirm the specifications or drawings.

Progress Payment Certificate

The Progress Payment Claim should be used when submitting progress claims to an owner.

Practical Completion Stage Notice

An anticipated Practical Completion Notice should be provided to an owner to notify them that the works will be ready to inspect on the nominated date.

Defects Document

It is a legislative requirement to provide the owner with a Defects Document at Practical Completion. The Defects Document is used to document minor defects or omissions. You are required to complete the defects document with the owner during the Practical Completion inspection.

According to the QBCC Act, the defects document must:

  • List the minor defects and minor omissions that both you and the home owner agree to
  • State the date when you will attend to those matters
  • Separately list minor defects or minor omissions that only the home owner believes exist
  • Be signed by the contractor to be provided by the owner at Practical Completion.

Subcontracts

If you engage subcontractors for building work in Queensland, you must comply with the Queensland Building and Construction Commission Act 1991 (for commercial or residential work).

A subcontract is an agreement between two parties for an exchange of goods or services. All subcontracts between a contractor and a subcontractor, or a subcontractor and a sub-subcontractor, are required to comply with the Act. The Act requires that all subcontracts must be in writing.

To comply with the QBCC Act, the following items must be in writing:

  • Scope of building work
  • When building work is to be completed or, if appropriate, how the date is to be worked out
  • Amount to be paid or, if appropriate, how the amount to be paid for carrying out the building work is to be worked out
  • Parties’ agreement about retention amounts and securities held
  • Name of building contractor who is the contracted party for the building contract
  • Licence number of building contractor who is the contracted party for the building contract, and
  • Address of the land where building work is to be carried out.

Master Builders subcontract documents have been specifically tailored for the building and construction industry. Each contract allocates risk fairly, outlines obligations in detail, and complies with the requirements set out in the QBCC Act.

Subcontract Agreement

The Subcontract Agreement is a lump sum contract for use between a contractor and a subcontractor for subcontract works. This contract can be used on both commercial and residential projects.

Master Builders has two Subcontract Agreements available – the standard ‘Subcontract Agreement’ and the ‘Subcontract Agreement – Basic’.

The Subcontract Agreement is a comprehensive document that provides flexibility regarding:

  • Forms of Security
  • Payment reference dates and due dates for payment
  • Liquidated damages – not applicable, agreed rates and/or limits applicable
  • Delay damages
  • Time for submission of Extension of Time claims, and
  • Dispute resolution processes.

The Subcontract Agreement can be adjusted easily to align with the requirements of various forms of head contracts including Australia Standards or bespoke contracts. The obligations on both parties are clearly set out and the payment provisions address the common mistake that parties make in terms of providing for the due date for payment. This issue has serious consequences for both parties under the Building Industry Fairness (Security of Payment) Act 2017 (Qld). There is also clarity regarding retention release obligations on both parties which is impacted by the recent changes to the Queensland Building and Construction Commission Act 1991.

The Subcontract Agreement – Basic is a smaller and more compact subcontract that still complies with the recent legislation changes and can be amended, as needed, through special conditions to address differences in the head contract requirements. It allows for progress payments on a weekly, fortnightly or monthly basis but has no built-in flexibility for other payment arrangements. The Subcontract Agreement – Basic suits lower risk subcontracts or smaller work packages.

You can purchase both online via eDocs.

Special conditions addendums

If you have a version of the previous Subcontract Agreement in hardcopy, there are two Special Conditions addendums available to take care of recent legislative changes.

If you’ve purchased a hardcopy of the previous Subcontract Agreement from us in the past 18 months, download a copy of the relevant Special Conditions addendum below. Follow the instructions to insert correctly within the Special Conditions item of your contract.

Subcontract Agreement addendum - BIF special conditions

Subcontract Agreement addendum - ipso facto special conditions

Period Subcontract

The Period Subcontract is a subcontract between a contractor and a subcontractor containing rates that apply over an agreed period of time, used in conjunction with a work order to detail specific job requirements.  The two documents together form the subcontract.

You can purchase the Period Subcontract online via eDocs.

Special conditions addendums

If you have a version of the Period Subcontract Agreement in hardcopy, there are two Special Conditions addendums available to take care of recent legislative changes.

If you’ve purchased a hardcopy Period Subcontract from us in the past 18 months, download a copy of the relevant Special Conditions addendum below. Follow the instructions to insert correctly within the Special Conditions item of your contract.

Period Subcontract Agreement addendum - BIF special conditions

Period Subcontract Agreement addendum - ipso facto special conditions

Supporting documents

Throughout the construction period, a range of additional documents must be used to support the subcontract agreement.

Once a contract is in place and work has begun, it is important to document (in writing) any changes to the contract, no matter how minor, including:

Work Order

The Work Order is a companion document to the Period Subcontract to instruct specific work to be carried out. When a Period Subcontract is in place, outlining the time period and agreed rates, Work Orders are used each time agreed work is to be undertaken.

The contractor issues a Work Order to the subcontractor to advise, amongst other things, the address at which the work is to be undertaken, the extent of works and the relevant Period Subcontract to which the Work Order relates.

Confirmation of Variation/Instruction

A variation is a change to the scope of work outlined in the contract, such as an addition to or reduction in the scope of work that may result in an increase or decrease in the cost (value) of the work.

Master Builders Confirmation of Variation/Instruction is used to confirm variations or instructions that affect the scope of work.

Extension of Time

The Extension of Time form should be used to confirm any extensions of time that will affect the project completion date, due to a delay as allowed for in the contract.

It may be useful to refer to Master Builders construction period calendar, when calculating the anticipated completion date.

Request for Information

As the name suggests, the request for information should be used to request information from the contractor.

Voluntary Agreement

The Voluntary Agreement is an agreement between a contractor (builder) and a subcontractor or a subcontractor and their contract workers, outlining withholding tax and GST obligations of the parties.

Special conditions addendums

Special Conditions addendums for the  Period Subcontract Agreement and Subcontract Agreement contracts are now available to take care of recent legislative changes.

If you’ve purchased a hardcopy Period Subcontract Agreement or Subcontract Agreement from us in the past 12 months, download a copy of the relevant Special Conditions addendum below. Follow the instructions to insert correctly within the Special Conditions item of your contract.

Period Subcontract Agreement addendum - BIF special conditions

Subcontract Agreement addendum - BIF special conditions

Period Subcontract Agreement addendum - ipso facto special conditions

Subcontract Agreement addendum - ipso facto special conditions

Need more information?

If you haven’t found the answer to your questions on our website, give us a call or email us.

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