The construction law and legal topics have never been more important.
āBuilding back betterā has become a global slogan for efforts to recover from the economic shockwaves of the COVID-19 pandemic, but in the case of the construction industry, the phrase has particular resonance. Construction is always one of the industries most affected by economic turmoil, usually one of the first sectors to be wounded but also one of the first to recover. Those construction firms which understand the complexity of the moment, and have good financial and legal advice, are best placed to absorb the blows and flourish in the recovery.
Lets look at what happened after 2008ās banking crash, when many privately funded developments ran into financial troubles. The legal ramifications are still being felt today, with legendary Perth developer Luke Saraceni continuing to litigate over the financial troubles of his Raine Square project. On the other hand, the Government also accelerated billions of dollars worth of infrastructure projects to help kickstart the post-2008 economy, with many construction firms directly benefiting, even through to this very day.
The state of construction in the current economic challenges
Although there are many differences between then and now, there are also marked similarities. Even as early as April of this year, many construction firms were in distress and the New South Wales president of the Master Builders Association, Brian Seidler, said the crisis was affecting both large and small projects. āPeople are wary about starting a kitchen because they worry that the industry will have to pull up stumps and they are stuck at home,ā he said. With unpredictability likely to remain a fact of life for the industry, and further disruptions very possible, construction firms need to get good advice from a property lawyer on what their rights are if an investor does want to pull or postpone a contract.
Even for those construction firms whose contracts all look healthy, the pandemic has caused new pressures. Disruptions to supply chains led to increases in material costs, particularly in the early days of the pandemic, while the need to place restrictions on workers to obey social distancing guidelines has led to greater costs and slower progress. Reasonable clients will understand the difficult position construction businesses are in and will negotiate with you over costs and deadlines, but if things get difficult this is another time when the understanding of construction law and the services of a law firm will help you manage a dispute can be a necessary investment.
Despite the setbacks, there are opportunities to take advantage of in the construction sector
Fortunately, there is also much good news to celebrate. Despite setbacks, the number of cases of COVID-19 in Australia has stabilised over the last six weeks, and economic confidence is returning. The Government has also recognized the disproportionate importance of construction to the Australian economy and has pumped an additional $15 billion into infrastructure projects as a way to kickstart it. At the same time, a Home Builder scheme to give $25,000 grants to people buying homes or renovating their existing property will boost many smaller construction businesses.
Irrespective of the size of your construction business, Ā there are many opportunities to take advantage of, but you do need to understand the construction law and the potential legal red tape which these opportunities come wrapped in. Winning infrastructure contracts from the Government is an arduous process, which requires a high level of regulatory compliance and expertly assembled bids. You need a property lawyer who also understands Government bureaucracy in order to win the kind of contract which can transform your businessesā fortunes.
Protect yourself legally as a construction business has been more important
Even for those smaller contracts which will emerge from the Home Builder scheme, there are regulations and laws to be aware of. To be eligible, the future homeowner needs to start the contract before the end of the year, has to intend to use the property as a principal place of residence, and earn within a certain income window. While it isnāt the job of a construction firm to understand these details, strictly speaking, it is still wise to have some understanding of the relevant rules and laws, so that you donāt enter into an agreement which will turn into a dispute later if funding becomes a problem.
Get a better grip on the construction law. This is one of those times where expertise becomes even more important than usual. Thatās as true of business as it is of public health.Ā The opportunities you and the choices you make over the coming months are likely to shape your business for years to come. Get the right advice from the right people – and then seize the moment. You can put the ābuildā in ābuild back betterā.
Who is Lazarus Legal?
A trusted Construction Lawyer can be the ultimate difference and differentiating factor for your construction or property development business. At Lazarus Legal, we work with a range of clients from small developments clients to large scale, corporate and government clients working on major commercial and residential developments including retail, aged care, recreational, education to name a few. Weāve had the opportunity to consult and help our clients over the years across a wide range of construction and building disputes.Ā
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Barry Lazarus
Weād be lying if we told you that this bloke isnāt the big honcho of our team, but his name is a dead give-away. The founder of Lazarus Legal, Barry Lazarus is an old school, tough as nails lawyer. They donāt forge litigators like this anymore. With decades of experience in both Australia and South Africa, his wisdom is as renowned as his name.
