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ToolShed won't be available on 1 February 2020 from 12am to 6am due to scheduled maintenance.

Public

How to deal with flood damage

  • February 27, 2023

Returning to your home after a flood is an overwhelming and traumatic time. For many whose homes are flooded, they’ve never been through this kind of event before and it can be hard to know where to start when one of your biggest investments has been damaged beyond your control.

Firstly, if your home has sustained flood damage, it will need to undergo a Rapid Building Assessment by your local council before you can return. Rapid assessments check your home’s structural integrity to ensure it is safe to enter. If council’s building inspectors give your home a red sticker, it means the building has been seriously damaged or is at risk from further hazards. They’re not a demolition order, but you will need to talk to your building inspector/council and insurer in the first instance to determine the next steps.

If your home is given a yellow sticker, you can have limited entry to your home. The building has been damaged and may need to be vacated in the short term, or occupied by authorised people only, or entry is at people’s own risk. Again, a conversation with the building inspector and your insurer should be your first move. You can see more information about rapid building assessments here.

Once you’ve been given the go ahead to enter your home, take photos and videos of any damage or anything which needs to be replaced for insurance. Photos will help speed up assessments of your claims. If you rent, contact your landlord and your contents insurer.

It is important to clean and dry your house and everything in it. Keep children and animals away from damaged areas until they have been thoroughly cleaned. Any gas or electrical goods, including your gas meter, which have been in contact with flood water will need to be checked by a professional before you can use them again.

Floodwater may contain sewage and other hazardous materials which can contaminate your home, so it’s important to take safety precautions.  Wear a fitted P2- or N95-rated mask, goggles, gloves, long pants, a long-sleeved shirt, and gumboots or work shoes. Cover any open cuts, scratches, grazes and wounds with waterproof plasters or dressings.

Mould will develop quickly and cause illness, especially for those with asthma or respiratory illnesses. Follow medical advice and, if you can, hire professionals if there is a lot of mould. And, finally, always wash your hands thoroughly afterwards and before any food prep.

Cleaning up outside

First up, clear your access to the building – the rest of the section can come later. Use a shovel to remove surface contamination, ensuring you clear space in front of any ventilation holes or access underneath of your home. Place any silt or sludge at the edge of your section, ensuring it doesn’t block drains or the road gutter. Hard surfaces, such as driveways, can be cleaned and disinfected with 1 litre of household chlorine bleach in 10 litres of cold water (a household bucket). Leave the disinfectant on for 30 minutes, then rinse with clean water.

The best way to make your outside area safer is to let it dry naturally. Leave garden surfaces and lawns exposed to the air and sunshine to dry out. Make drainage holes with a fork to aerate.

If your garden is heavily contaminated with sewage, use store-bought garden lime to disinfect the area, following the instructions on the label. Do not eat any produce which may have been in contact with flood water or grown in soil which has been in contact with flood water. Instead, clean up and remove debris and sprinkle gardens with lime to disinfect.

Cleaning up inside

If you have insurance, contact your insurer to lodge a claim and understand how they can help. They may undertake some of these steps for you as part of your claim.

Your aim is to clean up, drain, and dry inside as quickly as possible. Take everything that is wet and can be moved, included floor coverings, outside to dry.

Large items which have been in contact with flood water will need to be disposed of, as well as wooden kitchen items and baby bottle teats and dummies, as there is no safe way to clean them. Foam rubber mattresses or pillows may be able to be washed, disinfected, and dried in the open air. Get rid of contaminated clothing, carpets, upholstered furniture, toys and bedding, unless they can be safely cleaned and disinfected.

Open all doors and windows and use heaters (such as hot air blowers for under-floor spaces). Do not use outdoor gas appliances indoors. If there are signs that the house has moved on its foundations, such as buckled floors, new cracks in walls, or out-of- shape door frames, consult an engineer.

You’ll need to check for trapped water and mud in wall cavities, as well as under shower trays, baths, benches, and bottom shelves.  Remove skirting, if necessary, and cut out softened plaster board in damaged areas. Check with an expert such as an insurance assessor or your local NZCB builder.

Replace wall linings and floor coverings only after the building is completely dry and leave redecorating for at least three months after finishing the repairs, to prevent risk of mould, blistering, and peeling.

Do not light fires in brick fireplaces for at least two weeks, and then use only small fires until the firebricks have dried out.

Non-wooden cooking, eating and kitchen utensils that have come into contact with floodwater can be washed in hot soapy water then disinfected. After washing, rinse thoroughly in safe water, then disinfect by immersing for 1 minute in a solution of 500 ml (about 2 cups) of plain, unperfumed, household bleach in 10 litres of water. Rinse again in safe water. Alternatively, you can boil all utensils for 1 minute and let cool.

Floodwater can carry bacteria that can contaminate food, so throw away all food and drinking water that has come in contact with floodwater, including things stored in containers, as the seals may be compromised. Avoid drinking or preparing food with tap water until you are certain it is not contaminated. Follow any boil water notice instructions from your local authorities.

Above all, follow the instructions of your insurer, local council, engineers and building professionals – this may be your first time dealing with flood damage, but it’s unlikely theirs. Our builders understand this is a traumatic time for you and your whānau and are here to help you throughout the process as you rebuild your home and life.

The New Zealand Government has also recently launched the New Zealand Claims Resolution Service, a free service providing residential homeowners with advice, case management support where appropriate, and access to legal, technical and well-being services to help them achieve timely, fair, and enduring resolution of their residential insurance claims resulting from natural disasters. You can see more about NZCRS here. 

To find a nearby NZCB builder to help with repairing your flood-damaged home, use the Find A Builder search function on www.nzcb.nz


Content source : Auckland City Council

Image credit : Pixabay paulbr75

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    Privacy Policy

    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. Invoices and Payments

    6.1 The Builder is not obliged to commence the Building Work until any deposit payable in accordance with clause 6.2 has been paid.
    6.2 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 19.9 or clause 20.4. 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.
    6.3 The Owner shall make progress payments to the Builder for Building Work completed and materials supplied, 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.
    6.4 Where the parties have agreed to progress payments at completion stages (Option A in Part D of the Schedule) the Builder may issue an invoice at any time after a relevant stage of completion is reached. If any stage would have been Practically Completed but for the deferral of certain work at the request of the Owner, a breach of the Owner’s obligations under clause 3.4, or a force majeure event as defined in clause 23.1, then the Builder may issue an invoice for the relevant proportion of that stage.
    6.5 Where the parties have agreed to progress payments at the end of defined periods of time (Option B in Part D 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.
    6.6 Notwithstanding clauses 6.4 and 6.5, Variations may be invoiced at any time after the relevant Building Work is Practically Completed and the Variation has been quantified by the Builder.
    6.7 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 E 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 specifying the reasons why any part of the invoiced amount is disputed, and the method in which the disputed amount has been calculated; and
    b. pay the undisputed amount.
    6.8 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.
    6.9 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.
    6.10 The Owner may at any time request the Builder to provide a receipt or statement recording or evidencing the payments received from the Owner.
    6.11 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.

    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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