ASKING FOR A DEPOSIT

We suggest that there are very good reasons why Contractors should be entitled to ask for Contract deposits, but the reasons given and the practices in relation to the taking and securing of Contract deposits are generally misconceived and possibly open to abuse by Contractors.

Sadly, and all too often, we hear of Contractors using deposit funds from one project to pay for the start or completion of other projects – often referred to as ‘robbing Peter to pay Paul’. That is why when Contractors go bust many of their clients suffer huge losses along with suppliers and subcontractors.

Those practices cannot be right or justified on any grounds.
BUILDSAFE^®can help you stand out from the crowd by providing you with the tools to give your clients confidence that they can trust you and that they should choose you over a builder who does not use the BUILDSAFE^® Security of Payment Scheme.

It is clear therefore that there is a fair and very proper place for the payment of a contract deposit, but it is the process and procedures in relation to ensuring that those monies are available to be put to the intended purpose that are most important.

That is exactly where BUILDSAFE^® comes in. BUILDSAFE^® will hold that deposit (the Security Amount) in trust, safe and secure until the end of the building project when that amount remains available to pay the Contractor its proper entitlement under the Contract. Of course, if the Contractor does not perform its obligations, the Security Amount remains safe and secure and available for the Owner.

In the unfortunate event that a dispute should occur, the Security Amount is available to a successful Contractor. It is one thing to be held entitled to monies to be paid by an Owner, but it is often another to enforce and collect. When the Security Amount is held in trust by BUILDSAFE^®, that amount is readily available.