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12 Insurance

12.1 Part G of the Schedule contemplates that the Parties will elect who is responsible for arranging the contract works insurance.
If the Parties have not made that election or if their intention is unclear, then the Owner must arrange contract works insurance
if the Building Work involves changes, alterations, renovations, restoration, repairs or maintenance to existing structures, and
the Builder is responsible for arranging contract works insurance if the Building Work involves constructing an entirely new
stand-alone structure. Irrespective of who arranges the contract works insurance, the excess on a contract works claim is
payable by the Owner. Given that such insurance typically expires on Practical Completion, the Owner must ensure that the
Building is insured from that point onwards.
12.2 The amount insured must be at least as much as the Original Contract Price, plus an allowance for Owner-supplied materials,
expediting expenses, removal of debris, professional fees, increased costs during construction, increased costs during reconstruction, and materials in storage (off the Project site). Unless otherwise agreed, the allowances for these items shall be
those shown in Part G of the Schedule, and if no allowance is made in that Part for any item then the allowance must be
reasonable in the circumstances.
12.3 The Owner must arrange contract works insurance against loss or damage to the Owner’s existing structures made available
by the Owner to enable the performance of the Building Work, or existing structures adjacent to the Building, and to the
Owner’s contents. This insurance must be for the full replacement value, and for consequential loss arising from loss or
damage to those structures and contents.
12.4 The Builder must arrange public liability insurance for loss or damage to any property, or illness, injury or death to any person,
that arises from the performance of the Building Work.
12.5* In the event of loss or damage to any part of the Building which is not caused by the Builder or any party for whom the Builder
is responsible:
a. The Builder is not required to carry out any restoration work at the Builder’s own expense.
b. The Builder will restore all loss or damage to the Building and the restoration work will be treated as a Variation.
c. The restoration work will be paid for from the proceeds of the contract works insurance.
d. If the delay in confirming insurance cover after loss or damage to the Building has occurred is such that the Builder
can no longer reasonably afford to maintain spare capacity to perform the Building Work when required, the Builder
may suspend the Building Work as if clause 20.2 applied, and if the Builder has not cancelled the contract in the
meantime, the Builder shall not be obliged to resume the Building Work until the Builder’s commitments reasonably
allow for a resumption.
12.6 If this Contract is completed on-line, and either Party has selected the option to apply for a contract works policy marketed
under the “REDi” brand, then an application for such a policy will be automatically generated from the information entered
into the Schedule of this Contract.
12.7 The insurance broker responsible for arranging the REDi contract works policy and the underwriter(s) to whom the application
is submitted together with their respective representatives or agents are authorised to obtain from, and disclose to, any other
party any information they consider relevant to the assessment of the application for the policy.
12.8 For the purpose of section 12 of the Contract and Commercial Law Act 2017, the provisions in this Part 12 are intended to
create obligations enforceable by the insurance broker and the underwriter(s) referred to in clause 12.7 and their respective
representatives or agents, whether or not they are parties to this Building Contract.

4. Calculation of Progress Payments & Final Contract Price

4.1 This is a building contract in which the total price payable for
the Building Work is not fixed, specified, or known at the time of
entering into the Contract. Instead, the progress payments and the
Final Contract Price are to be calculated by reference to the actual
costs incurred by the Builder in carrying out the Building Work, plus a
Margin for the Builder’s Off-site Overheads and profit. The Parties may
have chosen to enter into this form of building contract for any number
of reasons, including that it is too difficult for the Builder and/or
the Owner to accurately predict the precise scope of the Building Work
at the outset, or the Building Work involves innovative systems or
materials the cost of which is largely unknown, or to avoid the
administrative burden of having to recalculate a fixed contract price
each time a component of the work changes, or simply because it is
their preference to do so. While this inevitably involves some
uncertainty as to what the Final Contract Price will eventually amount
to, it has the advantage that at the conclusion of the Building Work
the Owner will have become liable to pay no more and no less than the
value of the Building Work and materials the Owner has actually
received.
4.2 The progress payments and the Final Contract Price payable to the
Builder shall therefore be calculated by reference to the hours of work
expended by the Builder and the Builder’s employees and contractors in
carrying out the Building Work, plus the materials and other direct
costs incurred by the Builder in carrying out the Building Work, using
the rates set out in Part F of the Schedule. Onto those amounts shall
then be added the Margins for the Builder’s Off-site Overheads and
profit, calculated by reference to the percentages shown in Part F of
the Schedule.
4.3 The Builder shall be entitled to charge for and recover all costs
that the Builder would not have incurred but for the Building Work, and
that are reasonably necessary to carry out the Building Work to the
standard required by this Contract, plus the relevant Builder’s
Margins. Those costs include (without limitation):
a. The Builder’s own labour and labour performed by the Builder’s
employees and contractors.
b. Products or services from subcontractors or specialist trades.
c. Professional advice such as architecture and engineering.
d. Building materials and consumables.
e. Hireage of tools, plant, equipment, appliances or vehicles.
4.4 The cost of labour shall be calculated using the labour rates
set out in Part F of the Schedule, or where no rates have been
specified in any particular case, at the prevailing market rates for
the personnel in question. The labour rates set out in Part F of the
Schedule apply to normal working hours and days, and in calculating
working hours no deduction shall be made for work breaks that are
reasonably necessary for the consumption of food or beverages or to
ensure the continued health, safety, productivity and efficiency of
the relevant personnel. Where in order to comply with the Builder’s
obligations under this Contract it is reasonably necessary for the
Builder and/or the Builder’s employees and subcontractors to carry
out Building Work outside of normal working hours or on weekends or
public holidays, and the Builder is required to pay penal or
overtime rates as a result, those penal or overtime rates shall be
included in the calculation of the cost of the Building Work.
4.5 All the costs of the Building Work apart from labour shall be
calculated by reference to the invoice issued to the Builder for the
relevant item, or if no invoice was issued, by reference to what the
Builder actually paid. Where such costs cannot be separately identified
or accurately ascertained through timesheets, invoices or otherwise,
the cost of those items shall be calculated having regard to the
prevailing market price for the relevant items.
4.6 The rates set out in Part F of the Schedule shall be adjusted for
any increase in the rates charged by subcontractors that could not
reasonably have been foreseen by the Builder at the time this Contract
is signed by the Builder, and which would otherwise have the effect of
eroding the Builder’s profit margin. The Builder must be able to
substantiate the increase by reference to written evidence such as
quotations, communications or invoices from the relevant subcontractor,
clearly demonstrating the rates that were first advised to the Builder
when Part F of the Schedule was completed, and the rates subsequently
charged. The Builder shall whenever reasonably practicable, resist any
rate increases and procure subcontracts on the basis of fixed rates
that cannot be increased during the course of the Building Work.
4.7 If any of the subcontractor rates set out in Part F of the Schedule
decrease for any reason (other than rebates or discounts provided to
the Builder as a result of such factors as loyalty, volume of business,
enticement to form a new or long term trading relationship, or
membership of a trade association or cooperative company), the
decreased rate(s) shall be used in the calculation of all progress
payments and the Final Contract Price from the time that the decrease
takes effect.
4.8 Either prior or subsequent to the Parties entering into this
Contract, the Builder may have given or may give to the Owner or the
Owner’s representative(s) an estimate, indication, projection, guess,
intimation, prediction or similar communication (together referred to
as an “estimate”) as to what the Final Contract Price or any component
of it is likely to turn out to be. It is common for building owners to
request an estimate and it is common for builders, in good faith and
out of a desire to be helpful, to comply with that request, or indeed
to offer an estimate unsolicited. The Parties acknowledge that even the
most carefully calculated estimate can in hindsight prove to be grossly
pessimistic or optimistic, and it is impossible for the Builder to
accurately predict what the final outcome of the Project will be, given
that so many factors are outside the Builder’s control.
4.9 The Parties have chosen this form of contract rather than a fixed
price contract because they have agreed that the Final Contract Price
will be determined by the hours of work and the materials and other
direct costs that are ultimately involved, and the margin applied to
those items. By definition, those hours and those costs cannot be known
in advance. The Parties therefore expressly record that any such
estimate that may have been or may be provided by the Builder –
assuming the Builder used the term “estimate” or some reasonably
equivalent expression – shall only represent the Builder’s best guess,
based on the Builder’s experience and what the Builder knows about the
Project itself to date. The Builder agrees to take reasonable care in
calculating any estimate that may be given, and to keep the Owner
regularly informed, by the provision of periodic invoices or otherwise,
of the amount paid and payable to the Builder in respect of the
Building Work at any given time.
4.10 A price estimate is fundamentally different from an undertaking,
promise, commitment, statement, assurance, warranty or representation
(together referred to as a “representation”) that the total contract
price will amount to, or will not exceed, a stated or fixed sum. If
the Builder has given such a representation, then that will bind the
Builder in accordance with its terms. However the representation must
be reasonably inferred from the wording used. For example if either of
the Parties has, without full knowledge of the legal significance,
mistakenly described an estimate as a “quote” or used some other
wording that might suggest a representation that would be enforceable
in law, then that will not constitute a representation if the Parties
did not intend it to have that effect.

13 Insurance

13.1 Part H of the Schedule contemplates that the Parties will elect who is
responsible for arranging the contract works insurance. If the Parties have not made that election or if their intention is unclear, then the Owner must arrange contract works insurance
if the Building Work involves changes, alterations, renovations, restoration, repairs or maintenance to existing structures, and
the Builder is responsible for arranging contract works insurance if the Building Work involves constructing an entirely new
stand-alone structure. Irrespective of who arranges the contract works insurance, the excess on a contract works claim is
payable by the Owner. Given that such insurance typically expires on Practical Completion, the Owner must ensure that the
Building is insured from that point onwards.
13.2 The amount insured must be at least as much as the Original Contract Price, plus an allowance for Owner-supplied materials,
expediting expenses, removal of debris, professional fees, increased costs during construction, increased costs during reconstruction, and materials in storage (off the Project site). Unless otherwise agreed, the allowances for these items shall be
those shown in Part H of the Schedule, and if no allowance is made in that Part for any item then the allowance must be
reasonable in the circumstances.
13.3 The Owner must arrange contract works insurance against loss or damage to the Owner’s existing structures made available
by the Owner to enable the performance of the Building Work, or existing structures adjacent to the Building, and to the
Owner’s contents. This insurance must be for the full replacement value, and for consequential loss arising from loss or
damage to those structures and contents.
13.4 The Builder must arrange public liability insurance for loss or damage to any property, or illness, injury or death to any person,
that arises from the performance of the Building Work.
13.5 In the event of loss or damage to any part of the Building which is not caused by the Builder or any party for whom the Builder
is responsible:
a. The Builder is not required to carry out any restoration work at the Builder’s own expense.
b. The Builder will restore all loss or damage to the Building and the restoration work will be treated as a Variation.
c. The restoration work will be paid for from the proceeds of the contract works insurance.
d. If the delay in confirming insurance cover after loss or damage to the Building has occurred is such that the Builder
can no longer reasonably afford to maintain spare capacity to perform the Building Work when required, the Builder
may suspend the Building Work as if clause 20.2 applied, and if the Builder has not cancelled the contract in the
meantime, the Builder shall not be obliged to resume the Building Work until the Builder’s commitments reasonably
allow for a resumption.
13.6 If this Contract is completed on-line, and either Party has selected the option to apply for a contract works policy marketed
under the “REDi” brand, then an application for such a policy will be automatically generated from the information entered
into the Schedule of this Contract.
13.7 The insurance broker responsible for arranging the REDi contract works policy and the underwriter(s) to whom the application
is submitted together with their respective representatives or agents are authorised to obtain from, and disclose to, any other
party any information they consider relevant to the assessment of the application for the policy.
13.8 For the purpose of section 12 of the Contract and Commercial Law Act 2017, the provisions in this Part 13 are intended to
create obligations enforceable by the insurance broker and the underwriter(s) referred to in clause 13.7 and their respective
representatives or agents, whether or not they are parties to this Building Contract.

9. Commencement and Completion of Work

9.1 The Builder shall commence the Building Work within a reasonable time after:
a. the Contract has been signed by both parties; and
b. any deposit payable in accordance with clause 7.2 has been paid; and
c. any necessary Building Consent or resource consent or other requisite consents or licences or consent amendments
have been issued.
9.2 Unless otherwise agreed in writing between the Parties, the Owner shall obtain all project information memoranda, Building
Consents, resource or other consents or licences, and consent amendments required for the Building Work.
9.3 The Owner shall promptly provide all information reasonably required by the Builder to enable the Builder to comply with the
Builder’s obligations under this Contract, whether prior to the commencement of, during the performance of, or after the
completion of the Building Work.
9.4 The expected completion date stated in Part B of the Schedule shall be automatically extended by a reasonable time where
delays arise due to:
a. Variations;
b. Any strike, lockout, or other industrial action;
c. Loss or damage to the Building Work other than loss or damage caused by the Builder’s breach of its obligations under
this Contract;
d. Flood, volcanic, or seismic events;
e. Inclement weather;
f. Failure to obtain consent or approval through no fault of the Builder;
g. Failure by the Owner to give timely directions;
h. Unforeseen physical conditions;
i. The Builder exercising its right to suspend the Building Work under this Contract;
j. Act, omission or default by the Owner or any person for whose acts or omissions the Owner is responsible;
k. A separate contractor’s act or omission;
l. Unavailability or shortage of materials;
m. Any other event which is beyond the reasonable control of the Builder and for which the Builder is not responsible.

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7 Invoices and payments

7.1 The Builder is not obliged to commence the Building Work until any deposit payable in accordance with clause 7.2 has been paid.
7.2 The Deposit shall be paid by the Owner upon signing the Contract. The Deposit shall be held by the Builder and applied towards payment of the final invoice, or as provided by clause 20.9 or clause 21.4. The Deposit is therefore not to be treated
as a progress payment. If the final invoice is less than the Deposit then the Builder shall pay the Owner the balance of the Deposit upon issuing the final invoice.
7.3 The Owner shall make progress payments to the Builder for Building Work completed and materials supplied, including any
adjustments for Provisional Sums, cost fluctuations or Variations, up to the end of the applicable period or stage of work. The
payments shall be made into a bank account provided by the Builder via internet banking or direct deposit, unless the parties
agree on a different payment method.
7.4 Where the parties have agreed to progress payments at completion stages (Option A in Part E of the Schedule) the Builder
may issue an invoice at any time after a relevant stage of completion is reached. If a completion stage cannot be reached
due to matters beyond the Builder’s reasonable control, and one month has elapsed since the previous invoice, the Builder
may invoice for the proportion of that completion stage that has been reached.
7.5 Where the parties have agreed to progress payments at the end of defined periods of time (Option B in Part E of the Schedule)
the Builder may issue an invoice for the Building Work completed up to the end of each such period. Any invoice issued in
advance of the end of the relevant period (other than a final invoice) shall be deemed to have been issued on the last working
day of that period.
7.6 The Owner must pay the invoiced amount in full within 5 Working Days of the invoice being delivered or sent to the Owner
or such other time as is stated in Part F of the Schedule. If the Owner does not consider that all or any part of the invoiced
amount is payable, the Owner must, within 5 Working Days after the invoice was delivered or sent to the Owner:
a. reply in writing to the Builder stating the amount that the Owner considers payable (the undisputed amount), and
b. specifying the reasons why any part of the invoiced amount is disputed, and the method in which the disputed amount
has been calculated; and
c. pay the undisputed amount.
7.7 If the Builder’s invoice is or is accompanied by a payment claim made under the CCA, then any payment schedule as defined
in section 5 of that Act must be provided to the Builder within 5 Working Days of the payment claim being served on the
Owner.
7.8 The Owner shall pay progress payments on the due dates, irrespective of when the Owner’s bank or financier is prepared
to advance any monies required by the Owner in order to meet the Owner’s payment obligations under this Contract. It is
the Owner’s responsibility to ensure that sufficient funds are available to comply with the Owner’s payment obligations under
this Contract. The issue of a Code Compliance Certificate is not a prerequisite to Practical Completion or the Builder’s
entitlement to payment of the final invoice.
7.9 The Owner may at any time request the Builder to provide a receipt or statement recording or evidencing the payments
received from the Owner.
7.10 The Parties will comply with their obligations (if any) under Subpart 2A of the CCA (which requires certain retention monies
to be held on trust or otherwise secured) to the extent that Subpart 2A applies to this Contract. The purpose of this provision
is to ensure that an adjudicator appointed under the CCA or an arbitrator appointed under the Arbitration Act 1996 has
jurisdiction to make a determination in respect of any such obligations, as if they were expressly incorporated into this
Contract.

4 Calculation of Progress Payments & Final Contract Price

4.1 This is a building contract in which the total price payable for the Building Work is not fixed, specified, or known at the time of entering into the Contract.  Instead, the progress payments and the Final Contract Price are to be calculated by reference to the actual costs incurred by the Builder in carrying out the Building Work, plus a Margin for the Builder’s Off-site Overheads and profit.  The Parties may have chosen to enter into this form of building contract for any number of reasons, including that it is too difficult for the Builder and/or the Owner to accurately predict the precise scope of the Building Work at the outset, or the Building Work involves innovative systems or materials the cost of which is largely unknown, or to avoid the administrative burden of having to recalculate a fixed contract price each time a component of the work changes, or simply because it is their preference to do so.  While this inevitably involves some uncertainty as to what the Final Contract Price will eventually amount to, it has the advantage that at the conclusion of the Building Work the Owner will have become liable to pay no more and no less than the value of the Building Work and materials the Owner has actually received.
4.2 The progress payments and the Final Contract Price payable to the Builder shall therefore be calculated by reference to the hours of work expended by the Builder and the Builder’s employees and contractors in carrying out the Building Work, plus the materials and other direct costs incurred by the Builder in carrying out the Building Work, using the rates set out in Part F of the Schedule.  Onto those amounts shall then be added the Margins for the Builder’s Off-site Overheads and profit, calculated by reference to the percentages shown in Part F of the Schedule.
4.3 The Builder shall be entitled to charge for and recover all costs that the Builder would not have incurred but for the Building Work, and that are reasonably necessary to carry out the Building Work to the standard required by this Contract, plus relevant the Builder’s Margins. Those costs include (without limitation):

a)   The Builder’s own labour and labour performed by the Builder’s employees and contractors.
b)   Products or services from subcontractors or specialist trades.
c)   Professional advice such as architecture and engineering.
d)   Building materials and consumables.
e)   Hireage of tools, plant, equipment, appliances or vehicles.
4.4 The cost of labour shall be calculated using the labour rates set out in Part F of the Schedule, or where no rates have been
specified in any particular case, at the prevailing market rates for the personnel in question. The labour rates set out in
Part F of the Schedule apply to normal working hours and days, and in calculating working hours no deduction shall be made for
work breaks that are reasonably necessary for the consumption of food or beverages or to ensure the continued health, safety,
productivity and efficiency of the relevant personnel. Where in order to comply with the Builder’s obligations
under this Contract it is reasonably necessary for the Builder and/or the Builder’s employees and subcontractors to carry
out Building Work outside of normal working hours or on weekends or public holidays, and the Builder is required to pay
penal or overtime rates as a result, those penal or overtime rates shall be included in the calculation of the cost of the
Building Work.
4.5 All the costs of the Building Work apart from labour shall be calculated by reference to the invoice issued to the Builder for
the relevant item, or if no invoice was issued, by reference to what the Builder actually paid. Where such costs cannot be
separately identified or accurately ascertained through timesheets, invoices or otherwise, the cost of those items shall be
calculated having regard to the prevailing market price for the relevant items.
4.6 The rates set out in Part F of the Schedule shall be adjusted for any increase in the rates charged by subcontractors that
could not reasonably have been foreseen by the Builder at the time this Contract is signed by the Builder, and which would
otherwise have the effect of eroding the Builder’s profit margin. The Builder must be able to substantiate the increase by
reference to written evidence such as quotations, communications or invoices from the relevant subcontractor, clearly
demonstrating the rates that were first advised to the Builder when Part F of the Schedule was completed, and the rates
subsequently charged. The Builder shall whenever reasonably practicable, resist any rate increases and procure
subcontracts on the basis of fixed rates that cannot be increased during the course of the Building Work.
4.7 If any of the subcontractor rates set out in Part F of the Schedule decrease for any reason (other than rebates or
discounts provided to the Builder as a result of such factors as loyalty, volume of business, enticement to form a new or
long term trading relationship, or membership of a trade association or cooperative company), the decreased rate(s) shall
be used in the calculation of all progress payments and the Final Contract Price from the time that the decrease takes
effect.
4.8 Either prior or subsequent to the Parties entering into this Contract, the Builder may have given or may give to the Owner
or the Owner’s representative(s) an estimate, indication, projection, guess, intimation, prediction or similar communication
(together referred to as an “estimate”) as to what the Final Contract Price or any
component of it is likely to turn out to be. It is common for building owners to request an estimate and it is common for
builders, in good faith and out of a desire to be helpful, to comply with that request, or indeed to offer an estimate
unsolicited. The Parties acknowledge that even the most carefully calculated estimate can in hindsight prove to be grossly
pessimistic or optimistic, and it is impossible for the Builder to accurately predict what the final outcome of the Project will
be, given that so many factors are outside the Builder’s control.
4.9 The Parties have chosen this form of contract rather than a fixed price contract because they have agreed that the Final Contract Price will be determined by the hours of work and the materials and other direct costs that are ultimately involved, and the margin applied to those items. By definition, those hours and those costs cannot be known in advance. The Parties therefore expressly record that any such estimate that may have been or may be provided by the Builder – assuming the Builder used the term “estimate” or some reasonably equivalent expression – shall only represent the Builder’s best guess, based on the Builder’s experience and what the Builder knows about the Project itself to date. The Builder agrees to take reasonable care in calculating any estimate that may be given, and to keep the Owner regularly informed, by the provision of periodic invoices or otherwise, of the amount paid and payable to the Builder in respect of the Building Work at any given time.
4.10 A price estimate is fundamentally different from an undertaking, promise, commitment, statement, assurance, warranty or representation (together referred to as a “representation”) that the total contract price will amount to, or will not exceed, a stated or fixed sum. If the Builder has given such a representation, then that will bind the Builder in accordance with its terms. However the representation must be reasonably inferred from the wording used. For example if either of the Parties has, without full knowledge of the legal significance, mistakenly described an estimate as a “quote” or used some other wording that might suggest a representation that would be enforceable in law, then that will not constitute a representation if the Parties did not intend it to have that effect.

6. Variations

6.1 The Builder shall carry out all Variations that the Owner or the Owner’s authorised agent instructs or requests the Builder to
carry out, provided that any such Variation does not impose an unreasonable burden on the Builder. Wherever reasonably
practicable any Variation shall be recorded in writing and the estimated cost of the Variation advised to the Owner by the
Builder, but any failure to do so shall not disqualify the Owner from his/her/its entitlement to have the Variation carried out,
nor disqualify the Builder from his/her/its entitlement to be paid for the Variation in accordance with the provisions of this Part
6.
6.2 The Builder shall be entitled to add the cost of any work performed on a Variation, to the Builder’s next invoice for the relevant
stage of completion or invoice period, depending on whether Option A or Option B in Part E of the Schedule is chosen.
Whenever reasonably requested by the Owner, the Builder shall separately identify the cost of the Variation from the cost of
the other Building Work to which the invoice relates, and provide reasonable documentary evidence to verify the cost of the
Variation. However separate identification and verification shall not be a prerequisite to payment of the relevant invoice on
or before its due date.
6.3 The cost of each Variation shall be equivalent to the total sum the Builder would have charged the Owner for the relevant
Building Work, if the Builder had carried out the Variation on a charge-up or cost-reimbursement basis. The Builder shall be
entitled to charge for and recover all costs that the Builder would not have incurred but for the Variation and that are
reasonably necessary to carry out the Variation to the standard required by this Contract, plus the relevant Builder’s Margins.
Those costs include (without limitation):
a. The Builder’s own labour and labour performed by the Builder’s employees and contractors.
b. Products or services from subcontractors or specialist trades.
c. Professional advice such as architecture and engineering.
d. Building materials and consumables.
e. Hireage of tools, plant, equipment, appliances or vehicles.
6.4 The cost of labour shall be calculated using the labour rates set out in Part G of the Schedule, or where no rates have been
specified in any particular case, at the prevailing market rates for the personnel in question. The labour rates set out in Part
G of the Schedule apply to normal working hours and days, and in calculating working hours no deduction shall be made for
work breaks that are reasonably necessary for the consumption of food or beverages or to ensure the continued health,
safety, productivity and efficiency of the relevant personnel. Where in order to comply with the Builder’s obligations under
this Contract it is reasonably necessary for the Builder and/or the Builder’s employees and subcontractors to carry out a
Variation outside of normal working hours or on weekends or public holidays, and the Builder is required to pay penal or
overtime rates as a result, those penal or overtime rates shall be included in the calculation of the cost of the Variation.
6.5 All the costs of the Variation apart from labour shall be calculated by reference to the invoice issued to the Builder for the
relevant item, or if no invoice was issued, by reference to what the Builder actually paid. Where such costs cannot be
separately identified or accurately ascertained through timesheets, invoices or otherwise, the cost of those items shall be
calculated having regard to the prevailing market price for the relevant items.
6.6 The relevant Builder’s Margins shall be applied to all costs of the Variation including labour. The total cost of the Variation
shall be calculated as follows:
a. Any GST component shall be deducted from all costs of the Variation including labour.
b. The relevant Builder’s Margins shall be applied to all costs (excluding GST).
c. GST shall be added to the total of b) above.
6.7 Notwithstanding clause 6.6 above, if a Variation results in a net decrease in the Original Contract Price, the Margins on that
net decrease shall be nil.
6.8 Where a Variation results in a reduction in the scope of the Building Work the Builder would otherwise have had to perform,
with the result that the Original Contract Price would have been less if the Builder had priced the job on the basis of plans
and specifications that included the Variation, then the Original Contract Price shall be reduced accordingly. The amount of
the reduction shall be calculated in the same way as an increase would be. However the Builder shall be entitled to set off
against that reduction, any costs or wasted expenditure incurred as a result of making the change during the course of the
Project, including any expenditure that was incurred in the reasonable expectation that the original plans and specifications
were going to be adhered to, plus the Builder’s Margin.
6.9 The Owner may only reduce the scope of the Building Work if the Owner no longer requires the eliminated work to be carried
out. To clarify, the Owner may not reduce the scope of the Building Work if the Owner intends to carry out the eliminated
work personally or engage a substitute builder or contractor to carry it out.

8 Commencement and Completion of Work

8.1 The Builder shall commence the Building Work within a reasonable time after:

a) the Contract has been signed by both parties; and
b) any deposit payable in accordance with clause 6.2 has been paid; and
c) any necessary Building Consent or resource consent or other requisite consents or licences or consent amendments have been issued.
8.2 Unless otherwise agreed in writing between the Parties, the Owner shall obtain all project information memoranda, Building Consents, resource or other consents or licences, and consent amendments required for the Building Work.
8.3 The Owner shall promptly provide all information reasonably required by the Builder to enable the Builder to comply with the Builder’s obligations under this Contract, whether prior to the commencement of, during the performance of, or after the completion of the Building Work.
8.4 The expected completion date stated in Part B of the Schedule shall be automatically extended by a reasonable time where delays arise due to:

a) Variations;
b) Any strike, lockout, or other industrial action;
c) Loss or damage to the Building Work other than loss or damage caused by the Builder’s breach of its obligations under this Contract;
d) Flood, volcanic, or seismic events;
e) Inclement weather;
f) Failure to obtain consent or approval through no fault of the Builder;
g) Failure by the Owner to give timely directions;
h) Unforeseen physical conditions;
i) The Builder exercising its right to suspend the Building Work under this Contract;
j) Act, omission or default by the Owner or any person for whose acts or omissions the Owner is responsible;
k) A separate contractor’s act or omission;
l) Unavailability or shortage of materials;
m) Any other event which is beyond the reasonable control of the Builder and for which the Builder is not responsible.

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