Clients and sub contractors of Watersun Homes left reeling after the company’s recent collapse may have access to a rescue fund to complete or fix their incomplete projects or recover payments.
Maddens Lawyers, a Victorian law firm with extensive experience negotiating insurance payouts, is pointing devastated Watersun home owners to the Domestic Building Insurance Policy (DBI) to help meet the inevitable costs of fixing the issues caused by the company’s voluntary administration last month.
Watersun Homes left around 300 homes incomplete when they appointed administrators last week. It’s also been reported that as much as $5 million is owed to sub-contractors.
Maddens Lawyers Senior Partner Brendan Pendergast explained the DBI was a mandatory policy for all building projects over the value of $16,000, that was taken out by the building company and came into play as soon as a contract was executed or building permit issued.
“DBI cover exists for situations exactly like this – when a company is insolvent, or for incomplete works on a building.
“This cover also allows for certain out-of-pocket expenses, like storage expenses while an owner is waiting for works to be completed, or accommodation costs.”
Mr Pendergast also noted that around 1,000 creditors had been impacted by Watersun’s recent administration and that sub-contractors had been hardest hit. Approximately $5 million of payments owed to sub-contractors were yet to be paid, he said.
“It may be open to sub-contractors to make a demand for progress payments under the Building and Construction Industry Security of Payment Act or make a claim for loss through their own business insurance,” Mr Pendergast advised.
Mr Pendergast said his firm’s experience with insurance providers was that getting the maximum amount possible out of a policy was a complex task – and that it was common for policy holders to end up with less than what they were entitled to.
“It is not unusual for people to encounter difficulties or uncertainties with the insurance claim process,” he said. “Maximising a payout can be something of a skill… almost all insurance policies are written in order to make this a tricky process that favours the insurance company over the policy holder.”
A detailed understanding of the insurance industry’s “peculiarities” was the best way to ensure the maximum amount payable was extracted – including compensation for legal fees, Mr Pendergast said.
“The DBI policy also makes provision for reasonable legal fees – so seeking the help of a lawyer is a low-risk situation for a home owner looking to find the financial means to bring their dream home to completion,” he said.
Mr Pendergast encouraged impacted property owners or sub-contractors to contact Maddens Lawyers for assistance by telephoning 1800 815 228 or lodging an inquiry online.