Essential Tips To Avoid And Resolve Renovation Disputes

It’s no doubt renovation is a key part of creating a space you love – but when miscommunication, extra charges, shoddy workmanship and defects start appearing, renovation disputes can threaten to turn your dream home into a real nightmare.

Such disputes, which are more common than people think, can dramatically increase your financial outlay, and delay your home’s completion. Here are some helpful tips to avoid and resolve renovation disputes.

Tips for engaging a service provider for your renovation

1. Know the difference between a contractor, and an ID. A contractor will usually just be the one engaged to perform the work, whereas an ID will advise on and help conceptualise your home’s design, and manage the various contractors involved.

2. Not all IDs have in-house contractors, meaning the work may be sub-contracted; ascertain the scope of the works that will be done by the service provider, and those sub-contracted. While subcontracting isn’t necessarily a bad thing, since the work is usually done by a more specialised contractor, it also means less control over the workmanship quality.

3. How did you find out about the contractor or ID? If they were recommended from friends, what feedback did they give? Ask around and do some research.

4. Consider how long has the service provider has been in operation.

If you’re planning to engage a contractor, consider those under the CASETRUST-RCMA Joint Accreditation scheme. For those renovating a HDB unit, note that contractors need to be registered with HDB.

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Tips on your renovation contract

Contracts are important to capture everything in black and white – do not accept any verbal promises because they can be difficult to prove and enforce in court. Here are some key things to take note of:

1. Payment. A service provider asking for full payment upfront should raise some serious red flags, since most, if not all, work on a progressive payment scheme. Set out a timetable for payment tied to milestones that the contractor agrees to.

2. Schedule. Work out a schedule with clear deadlines for completion with your contractor and rectification works and include it in your renovation contract.

3. Variations. It’s not uncommon to require variations in your renovations in the middle of the project; include a variations clause to give you flexibility. This is one of the most common grounds of dispute, so take the time to review this clause.

4. Liquidated Damages. Spell out what the damages are if the contractor is unable to meet the agreed-upon timelines. This can help speed up claims, but it must be of a reasonable amount.

5. Warranty. Check that the warranty scope and period is reasonable and not overly in favor of the service provider.

6. Defects. Record down any outstanding defects by taking photos and compiling them into a list; once the renovation works are completed, this list can be used as a reference checklist to resolve the defects one at a time.

7. Dispute Resolution. Look out for a clause that includes a clear, agreed-upon avenue to resolve any disputes that might arise to avoid complications in the future.

After signing your renovation contract

Supervise the renovation works, and if you have any concerns, let your contractor or ID know. Document and record any defects you spot immediately for reference and rectification.

But if you’re unhappy with your current contractor or ID and want to engage another to take over the renovation works, inform your current contractor, and mutually agree on the terms for termination and payment. Then, make sure your new service provider is fully briefed on all your needs, and note that you may need to change your house keys, and apply for a new HDB renovation permit.

If you’re in a renovation dispute…

The most common renovation complaints or disputes are those relating to variations and substandard or defective works. Here are five options you can pursue to manage the situation constructively:

1. Direct communication with the responsible party

Direct communication and discussion with the contractor to resolve the issue amicably out of court should be the first step you take before exploring other options.

First, check if the contractor has breached any of the terms and conditions listed on the contract. If the contractor has broken his contractual obligations, communicate your complaint with reference to the contract’s terms, and to be fair, give the service provider the opportunity to rectify the issue, or propose an acceptable compromise. If the complaint involves defective materials supplied by a subcontractor, then the main service provider will have to take responsibility.

2. Lodge a complaint with CASE

If the contractor refuses to take responsibility for breaking the terms of the agreement, then you may lodge a complaint with CASE, who will then correspond with the contractor on your behalf, or write a formal letter to the contractor regarding your complaint. The organization, however, has no power to make binding orders when a complaint is made.

3. Mediation by CASE or a neutral party

Mediation by CASE is a relatively affordable option for homeowners to resolve such renovation disputes, especially compared to an expensive and lengthy civil lawsuit! If the mediation session resolves the issue, then another binding agreement that settles the complaint can be made. If the contractor then breaks the terms of this agreement, you would have a good reason that can be used to launch a lawsuit.

4. Lodging a claim with the Small Claims Tribunal

If your “cause of action” was a year ago or earlier, and you want to claim up to S$10,000, you can file a claim with the Small Claims Tribunal. “Cause of action” can refer to the date the renovation contract was broken, or when the renovation works were due to be completed, but was delayed or completed in an unsatisfactory manner.

You are entitled to claim for an amount up to S$20,000, if your service provider agrees to a hearing at the Small Claims Tribunal. You may want to check with another contractor to determine the cost of correcting the defect, to determine how much to claim for.

5. Obtaining legal advice or launching a lawsuit

Depending on the terms listed in the original renovation contract, you may be contractually required to pursue mandatory mediation or arbitration first to resolve the dispute. But if all other options for dispute resolution have been exhausted, and the amount you are seeking to claim exceeds the maximum allowed under the Small Claims Tribunal, then you may consider consulting a lawyer for legal advice.

If you need legal advice, you can get a practicing lawyer to answer your questions on the phone within 48 hours for a flat fee of S$49 with an Asia Law Network Quick Consult.

This article is contributed by 99.co and done in collaboration with Asia Law Network.

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