What happens if my builder does not finish on time?

How is the completion date set?

Every NSW home building contract carries a statutory warranty that the work will be done with due diligence and within the time the contract states. Where no time is stated, the work must be finished within a reasonable time. The NSW Government's guide to building contracts lists this alongside the other warranties.

The Building Commission NSW home building contract for work over $20,000 fixes the period in two steps. Work must start within a set number of working days of the latest relevant date. That is the contract date, written notice of any council approval still needed or written notice that your lender consents to the work. It then gives a set number of calendar weeks to finish, already allowing for public holidays and the Christmas shutdown.

Whether a contract counts calendar days or working days makes a real difference. A working day count usually leaves out weekends and public holidays, so a 200 working day build runs well beyond 200 calendar days. Read that definition in your own contract before you compare one builder's program with another's.

When is a builder entitled to more time?

A builder is entitled to a reasonable extension of time when the work is delayed by a cause the contract accepts. The Building Commission contract lists inclement weather, a variation, an act or omission of the owner and materials that are unavailable through no fault of the builder. Its list also covers wider industrial disputes, court orders suspending the work that were not the builder's fault and other matters beyond the builder's control.

Under that contract the builder must claim an extension in writing within 10 business days of the event. Where a variation caused the delay, those 10 days run from the date you agreed to it. The notice gives the cause and the expected length of the delay. You then have 10 business days to dispute the claim in writing. If you do not respond, the completion date moves by the time the builder asked for, so a delay notice deserves a prompt and considered reply.

The NSW Government's advice on home building delays suggests asking the builder to explain why an extension is needed and checking the contract's delay clauses before you agree. An extension can also carry extra costs for materials and labour, depending on what your contract says.

What are liquidated damages?

If the builder misses the completion date and you have not agreed to an extension, the NSW Government says you could be owed money for damages or breach of contract. A contract can set those damages in advance as liquidated damages, a fixed amount for each day the work runs late. The figure is meant to reflect your likely costs, such as rent or a longer stay in temporary accommodation.

The Building Commission contract does not include a liquidated damages clause, so one only applies if your contract adds it. Some clauses set a nominal rate such as $1 a day. An Australian construction lawyer's review of NSW liquidated damages law explains a 2024 NSW Court of Appeal decision on that point. It held that clear words are needed before a nominal rate becomes your only remedy. Independent legal advice on this clause before you sign is worth the cost.

What should you do while the job runs late?

Keep a written record of every delay notice, reply and site meeting. Keep paying the progress payments your contract sets for work that is complete, because the NSW Government warns that a builder can take recovery action over a missed payment. An extra payment outside the contract may not be recoverable under home building compensation cover.

Plan for the delay at home as well, whether that means extending a lease or arranging somewhere else to stay. Ending a contract over delay is a last resort with real legal risk, so take advice first. If talks stall, the NSW Government's steps for resolving building disputes lead to the free Building Commission NSW complaint service.

How we plan the program at SHORE

At SHORE Design + Build we lock the program and order long-lead items (materials and fittings with long delivery times) before we break ground. We also confirm the contract sum at that point, so you know the timeline and the numbers before construction begins.