Queensland Consolidated Acts

DOMESTIC BUILDING CONTRACTS ACT 2000 - SECT 56

(1) A cost escalation clause in a regulated contract is void unless--

(a) the building owner's signature or initials, or seal, is placed next to the clause; and

(b) either--

(i) the contract satisfies a cost escalation requirement; or

(ii) the clause satisfies the cost escalation requirements.

(2) For subsection (1)(b)(i), a regulated contract containing a cost escalation clause satisfies a cost escalation requirement if--

(a) the contract price is more than the set amount; or

(b) the contract is to be administered by an architect engaged by the building owner.

(3) For subsection (1)(b)(ii), a cost escalation clause in a regulated contract satisfies the cost escalation requirements if the clause--

(a) is a cost escalation clause because of the operation of section 11(1)(b); and

(b) is limited by condition to cases of delay satisfying the requirements of this section; and

(c) provides for an increase of the contract price under this section.

(4) For subsection (3)(b), the delay must be a delay--

(a) for a delay happening before the subject work is started--

(i) that is longer than 4 weeks; and

(ii) for which the building contractor is not responsible; or

(b) for a delay happening after the subject work is started--

(i) for which the building owner is responsible; or

(ii) if the contract is being administered by an architect engaged by the building owner--for which the architect is responsible.

(5) For subsection (3)(c), the increase must not be more than the lesser of the following amounts--

(a) the amount of the costs incurred by the building contractor because of the delay;

(b) the formula amount for the delay.

(6) In this section--

formula amount, for a delay, means--

(a) if the delay happens before the subject work is started--the amount representing 0.125% of the contract price for each week, or part of a week, of the delay after the first 4 weeks of the delay; or

(b) if the delay happens after the subject work is started--the amount representing 0.05% of the contract price for each day of the delay.

set amount means--

(a) the amount, above $200000, prescribed under a regulation as the set amount; or

(b) if an amount is not prescribed for paragraph (a)--$200000.