When looking to purchase a house, you may note that some properties are marketed as “cross leases”.  This article seeks to clarify what cross leases are, and what you need to look out for should you purchase one.

Cross leases were originally created as a convenient and cheaper alternative to a fee simple subdivision. As they are now included under the definition of subdivisions, cross leases are becoming a less desirable form of ownership. It is important to understand exactly how they operate, as they involve greater obligations than a fee simple title.



Fee Simple vs. Cross Lease


A “fee simple” title grants you the most freedom and access. It bestows the full, permanent and absolute occupancy (tenure) in the land and will last indefinitely (subject to the rights of the Crown in some instances).

A cross lease property still involves an underlying fee simple title; however each cross lease owner owns only a share in the overall property. In addition, each owner leases individual flats from all the fee simple owners. The lease term will typically be limited to 999 years. The Certificate of Title will include a Flat Plan, which highlights the area of each flat, the common areas (such as a shared driveway) and restricted areas that each owner has private use of, such as a garden.



Alex, Bradley and Charlotte own three cross-leased properties: Flat A, Flat B and Flat C, on 1 Example Street. As a group, they collectively own the land, with no exclusive ownership of any specific part of the land. Instead, they each hold a one-third “undivided” share in the fee simple estate.

As a group, Alex, Bradley and Charlotte lease the flats to themselves individually. So Flat A is leased to Alex, Flat B to Bradley and Flat C to Charlotte. Their leases (which are registered on the title), provide exclusive use and enjoyment of the flats for each owner.

Should Alex wish to sell Flat A, he will be selling his 1/3 interest in the underlying fee simple title and his interest in the Flat A lease.

Tips on things to look out for:


  • Cross lease covenants: These are contained in the lease and each flat owner must comply with them. Examples of covenants include:
    • Not altering or improving the leased structures without written consent from all other flat owners;
    • Having a comprehensive insurance policy in place; and
    • Allowing the inspection of each other’s flats to ensure compliance with the covenants.

In our experience, many cross lease owners simply ignore their obligations, which can cause issues down the track, most commonly when you come to sell the property.

  • A title condition in the Agreement for Sale and Purchase: This allows your lawyer to look over the title and related documents to ensure they are accurate and check for any issues.
  • How will the common areas be maintained? Before buying the property, it is important you are clear on expectations in relation to “shared” areas. How different insurance policies might respond to these areas, such as driveways, is also relevant.
  • Explore the relationship with the neighbours: As you will need their consent for alterations, it will be important to maintain a positive relationship with the other cross lease owners. Though be aware that the vendors may not want to disclose anything adverse given their desire to sell, hence you may need to carry out your own enquiries where possible.
  • Be careful to check that the actual property matches the Flat Plan: If any physical improvements or alterations have not been included on the flat plan, the title will, strictly speaking, be defective. This could affect whether you have leasehold title to the common or restricted areas, or to certain improvements. To remedy this, you will need to obtain the consent from the other owners, and have the flat plans amended. This can be time consuming and costly, so ideally you would require the vendor to sort this before you purchase the property. Indeed, in some instances the costs involved may mean it is prudent to explore converting the cross lease ownership to a fee simple one – the greater “freedom” of the latter might even result in the property increasing in value, which could offset any costs.

Cross leases can be complicated. If you are considering purchasing a cross lease property, it is essential that you obtain legal advice. Likewise, if you are thinking of selling your cross lease, you should also discuss your options with your lawyer before you take the property to market.


This article is not a substitute for legal advice and you should talk to a lawyer about your specific situation. Please contact Tim Rankin at Parry Field Lawyers (348-8480) timrankin@parryfield.com

New legislation is proposed restricting non-resident foreign buyers from purchasing existing homes in New Zealand. Set to be enacted next year, the changes will mean that residential land will come under the category of “sensitive land” in the Overseas Investment Act (OIA). Any existing transactions and applications made before commencement are not affected.


Permanent residents and Australians will need to have resided in New Zealand for at least 183 days of the past year to be able to purchase property without scrutiny from the Overseas Investment Office (OIO). Those on temporary or student visas will be unable to purchase a house at all, but other-resident class visas will be screened.

These changes are significant as they represent quite a move in direction from the previous government.  For those who are overseas and looking to buy a house in New Zealand or considering a move to New Zealand it may impact on their decision.  However, some have pointed to statistics showing that there are not as many foreign buyers as people think so it will be interesting to see what impact it actually has on the housing market.


What are the exceptions to the general rule?

There are three exceptions. The first allows anyone to buy land and build a residential home on it, so long as they sell it on to add to the housing supply. Those planning to knock down an existing house to build several more will also come under this exception.

Secondly, overseas persons may buy sensitive land if they will convert the land to another use and are able to demonstrate this will have wider benefits to the country.

The third exception allows people buy a home if they intend to live in New Zealand. Housing Minister Phil Twyford has said:

“We do not want to deter people who have the genuine intent to make New Zealand their home and contribute to the country. We want to encourage foreign investment in the building of homes.”


What is residential land and how is it defined?

In the Explanatory Note, residential land consists of the following:

  • Apartments
  • Dwelling houses
  • Land which is likely to be developed into dwelling house sites
  • Where the dwelling house is the predominant use and there is an additional unit of use attached to, or associated with, the dwelling house which can be used to produce income


What about lifestyle land – is it covered?

Lifestyle land also comes under this category. It is defined in the Rating Valuations Rules 2008 as –

“Lifestyle land, generally in a rural area, where the predominant use is for a residence and, if vacant, there is a right to build a dwelling. The land can be of variable size but must be larger than an ordinary residential allotment. The principal use of the land is non-economic in the traditional farming sense, and the value exceeds the value of comparable farmland.”

This category includes:

  • Bare or substantially unimproved land, which is likely to be subdivided into smaller lifestyle lots:
  • Improved to the extent that there is some residential accommodation sited on the land:
  • Vacant or substantially unimproved land without immediate subdivision potential.


Negotiations are currently under way with Singapore to make sure the change doesn’t breach the current free trade agreement with them. However Minister Twyford has said that if issues can’t be resolved, then Singaporeans may be granted an exemption, similar to the one for Australia.


This article is not a substitute for legal advice and you should talk to a lawyer about your specific situation. We have experience with OIO applications in New Zealand and have assisted our clients from overseas through the process., please contact Steven Moe at Parry Field Lawyers (348-8480) stevenmoe@parryfield.com

Recently the new Government announced the issue of a Ministerial Directive Letter to the Overseas Investment Office.  From mid-December 2017 the Letter applies to both current and new applications. The Directive Letter serves to outline the Government’s policy approach to overseas investment in rural land, while the rules regarding the acquisitions of significant business assets remain unchanged. Overseas investors must now demonstrate that their investment will benefit New Zealand in order to obtain consent to acquire sensitive land.


Some of the key changes are:

Rural Land

The Letter states that certain factors will be of high relative importance for overseas investments of rural land larger than five hectares (which does not include forest land). These include:

  • The jobs factor – that the investment will create new job opportunities and/or retain existing jobs in New Zealand
  • The new technology of business skills factor – that the investment will result new technology or business skills
  • The increased exports receipts factor – that the investment will increase export receipts in New Zealand
  • The increased processing of primary products factor – that the investment will result in increased processing in New Zealand of New Zealand’s primary products
  • The oversight and participation by New Zealander’s factor – that the investment will provide for significant participation and oversight by New Zealanders

Forest Land

Factors of relative high importance for overseas investments in forest land include:

  • The increased processing of primary products factor
  • The advance significant Government policy or strategy factor

Overseas Person

An overseas person intending to reside in New Zealand indefinitely is not required to show that their investment in sensitive land is likely to benefit New Zealand. To meet this intention to reside criterion, an overseas person will generally:

  • Hold a residence class visa or an entrepreneur work visa; and
  • Show actions and plans, with supporting evidence, consistent with an intent to reside in New Zealand within 12 months

This is a tighter restriction than the previous letter. Other changes include that the sponsorship of community projects and donations is now generally of low relative importance.


Overall, this new policy directive sets out to welcome high quality overseas investment that:

  • Generates high levels of benefits to New Zealand
  • Creates new productive assets
  • Is environmentally sustainable, minimising adverse impacts on the natural environment, and is likely to create positive and long lasting environmental benefits
  • Provides economic, environmental, social and cultural benefits to regional communities
  • Significantly increases value added activities in New Zealand
  • Provides for significant participation and oversight by New Zealanders


This article is not a substitute for legal advice and you should talk to a lawyer about your specific situation. We have experience with OIO applications in New Zealand and have assisted our clients from overseas through the process., please contact Steven Moe at Parry Field Lawyers (348-8480) stevenmoe@parryfield.com



The new Government in New Zealand has announced changes to the foreign investment system.  This will restrict non-resident foreigners from purchasing houses in New Zealand by changing the definition of “sensitive” to include such housing.  At present other land is defined as sensitive under the Overseas Investment Act (OIA).  That includes for example land that is bordering reserves and parks or on the foreshore of lakes or rivers or which is farming land (among others).  For an overview on the overseas investment process click here and for information about key issues when immigrating to New Zealand click here.

New Zealand house prices have been increasing in the last few years and the intention behind the rule changes is to prevent foreign speculation on house prices.  Ultimately, the Government is hoping to stop their growth which has been resulting in New Zealanders not being able to afford to purchase a home, particularly in Auckland where the average house price is very high.

David Parker the new Trade Minister said the following in a recent interview: “We’ve got to fix land. We think it’s absolutely abhorrent that New Zealand government would lose the right to control who buys homes in New Zealand from overseas. And we’re working up mechanisms on that.”

While the purpose is clear the exact mechanics and timing is not.  Some have raised concerns that such a ban could be difficult in the context of different free trade agreements in place or due to be signed like the Trans Pacific Partnership (TPP).  However, the intention is certainly clear and it is highly likely that there will be change soon.

We will provide updates when the precise changes are known but wanted to get this briefing note out in the meantime.  We have acted for foreign buyers who are looking to purchase assets in New Zealand and can help you if you have any questions about the process.

We have also prepared a detailed guide called “Doing Business in New Zealand” which has an overview about the New Zealand business environment.  We are happy to email that out to those who would find it of help.


This article is not a substitute for legal advice and you should talk to a lawyer about your specific situation. Should you need any assistance or would like to request a copy of the “Doing Business in New Zealand” guide, please contact Kris Morrison at Parry Field Lawyers (348-8480) krismorrison@parryfield.com

Did you know you could get up to $20,000 towards your house purchase in Selwyn?

Housing New Zealand offer a Homestart Grant to people who meet their criteria.  If you are wanting to buy a new build in Rolleston, Prebbleton, Darfield, Lincoln or elsewhere in the Selwyn area then this Grant could help get you there.

Amy Adams MP in her June 2017 Amy in Action update stated she was pleased “to learn that 575 KiwiSaver HomeStart grants have been issued over the past two years to help people buy their first homes in Selwyn.”

Amy noted “in the past year, the scheme has helped 412 people in Selwyn with grants worth a total of $3.1 million. 163 first home buyers benefited in the first year of the scheme through $1.2 million in grants.”

There are certain criteria you must meet which is all set out at the Housing New Zealand Website. Please click here for more details.

There are a lot of new homes for sale in Rolleston and the rest of the Selwyn area that fit the criteria so it is a great opportunity to get on the property ladder. If you are looking at buying a house in Rolleston, Lincoln, Prebbleton or the greater Selwyn area get in touch with us so we can discuss whether you might be eligible for this grant.

Our office in Rolleston is located at 68 Rolleston Drive.  Send us an email at paulowens@parryfield.com or judithbullin@parryfield.com to set up a time to meet.

Paul Owens and Steven Moe outside the Rolleston office at 68 Rolleston Drive


We have a lot of clients coming to us with a building project where the contractor or consultant proposes using a standard form contract. It can be confusing as to which one of these documents is best to use in different situations.

This is because different industry bodies have developed their own forms of standard contract. Sometimes having too many options means that there is confusion over the best one to use. In this article we have described the most common form of construction contracts and building contracts and given a comment about when they are most appropriate to be used. In the second part we have also set out what some of the key issues are that need to be considered every time (no matter what contract is used as a base).


Which form of building or construction contract?

Below we have set out the most common standard forms of contract. The references are to the most recent forms of each which is an important point to note because sometimes you may be given an earlier version. Generally the latest issued copy has been done for a reason and it addresses some inadequacy in an earlier iteration. So closely check what year the version you are asked to sign was issued.

  • NZS3910: 2013: This is one of the most commonly used construction contracts and is generally considered to be quite a “fair” standard form which is used for building and civil engineering construction.
  • NZIA: SCC1: 2014 The New Zealand Institute of Architects have produced this standard form which has a leaning towards protection of the architect involved in the project.
  • BuildRight BCC: 2016: This is a free document intended for use when constructing residential buildings in New Zealand.  It can be requested on the Build Safe website.  Note that it includes automatic provisions using their retention trust fund.
  • BuildRight BCS: 2016: As above, but this is for sub contract situations.
  • IPENZ and FIDIC: These two engineering bodies (the New Zealand Institution of Professional Engineers and the International Federation of Consulting Engineers) publish standard form documents which tend to include provisions that protect engineers.
  • NEC3: A suite of contracts that can be used for building projects but mainly used for large scale construction projects.
  • RBC1: 2016 (NEW BUILD): Prepared for use by Registered Master Builders it is available to them for use on building contracts.

In addition to those set out above their can be bespoke / one off forms which particular companies many propose be used.  The important point here is that there are a variety of options when it comes to a building contract or construction contract.  Knowing what the options are is a good first step to being able to decide which one would be best for your project.

Key issues to consider in your building or construction contract

There are a number of other practical points that should be covered in your agreement.  Even if there is a standard position in one of the contracts above it should be read and ensure that you are comfortable with it.  Key matters to consider include:

Indemnities: These are often “high risk” clauses, because they can trigger a liability to pay a sum of money without the party relying on the indemnity even needing to prove that the other party caused, or contributed to, a loss.  It is important to be clear about what exactly will trigger an indemnity, who it will cover and whether it is reasonable in the circumstances to require one at all.

  • Limitation of liability and exclusion clauses: These are commonly included and essentially involve one party trying to get out of, or limit, their liability.  Consider to what extent they should apply.
  • Insurance: The insurance position of each party should be clearly understood to ensure there is adequate insurance cover.
  • Construction Contract Act: If this applies then certain provisions will be included in agreements eg default provisions relating to payment.
  • Price and payments: How much is paid and when.  This may involve setting out milestone and deliverables.
  • Variations: How will these be requested and priced needs to be set out clearly and understood.
  • Disputes: How will these be handled if they arise.
  • Reporting: What reports are required and when – this will be important to be able to monitor progress of the project.
  • Health and safety: Who is responsible for what and who is a PCBU at the work site.  This is a hot topic these days and should be thought through in detail.
  • Sub contracting: To what extent will this be done, and who is responsible for this.  This is about ensuring clarity about who will actually do the work.
  • Security: Many contracts contain an agreement to mortgage which could result (in the event of non-payment, or even in a dispute over payment) in a caveat being lodged against the title to your property.
  • Termination: Ability to terminate in which circumstances and what happens if that occurs.

Building contractors must give consumers a Checklist and a Disclosure Statement published by the Ministry of Business, Innovation and Employment prior to signing a building contract for all residential building work valued over $30,000.00 (including GST), or where the consumer asks for the information irrespective of the value of the building work.


This article is not a substitute for legal advice and you should talk to a lawyer about your specific situation. Please contact Tim Rankin at Parry Field Lawyers (348-8480) timrankin@parryfield.com

1. 先和您的律師溝通 – 越早和我們商議買賣流程,房產狀況和買賣合約(尤其是包含在合約裡的條款)對您越好。 我們在這方面有經驗 – 讓我們成為您的嚮導!

2. 確保這是適合您的房子 – 如果您不確定這房子是否適合您,請不要簽署出價協定,因為一旦簽署了而您又想改變主意的話就變得困難多了!

3. 給您自己充足的時間 – 這可能是您最大宗的購買所以請不要焦急! 這個過程可以有壓力,而緊迫的時間表則會讓事情變得更糟。試著給自己足夠的時間去徹底調查房產,儘量不要加快這個過程。

4. 注意地震損毀問題 – 如果您購買的房子在基督城或坎特伯雷地區,您需要考慮地震對房子造成了什麼損壞。詳細詢問EQC和私人保險公司的索賠,確認索賠是否已經解決,或是如何解決。

5. 房子是否有保險?提前跟您的保險公司洽談,因為您需要確認可以為房子買到令人滿意的保險。檢查保險政策是否有任何不承保的事項 – 不承保事項可能為您和您的貸款人製造為題。

6. 不要忽視土地報告和產權 – 土地報告和產權文件提供關於房子的有用資訊,而且強調出值得注意的問題。嘗試審查這些文件以確保您不會接手這些問題。

7. 願意花錢在專業的報告上 – 不要害怕聘請合格的專業人士進行物業檢查(例如:建築報告,工程師報告,電氣檢查和物業估值)。這些報告是您盡職調查的一個重要環節。現在花一些錢可以為將來節省很多錢!

8. 我是否有資金來完成購買?如果您是貸款來完成購買,請儘早聯繫您的貸款人或抵押貸款經紀人。通常銀行在滿足審批條件後才會批出貸款。 您需要準備完成銀行的這些條件。記得–請儘早讓我們知道如果您合資格從KiwiSaver撤回資金或可以得到紐西蘭房屋署的首次置業頭期款補貼。

9. 想想您將來的計畫,您購買財產的目的是什麼?這將是您的家庭住房,一個出租的物業,您將會在那裡經營生意,還是您打算在將來進一步開發?考慮以及與我們討論您未來的計畫是很重要的。可能也需要來自其他專家建議,如稅務專家,城市規劃師,測量師。

10. 請記住房子交割前的檢查 – 您的合約將幾乎都允許您擁有進行交割前檢查的權利。這是一個確保房子處於和您簽合約時類似的狀況的很好的機會,避免當您搬進來的時候發現不必要的驚喜!

The media has been reporting about the increased use of Methamphetamine.  This article outlines how it could affect you!

Methamphetamine is a powerful, highly addictive stimulant that affects the central nervous system.  Commonly known as P, Meth, Chalk, Ice or Crystal, it takes the form of a white, odourless, bitter-tasting crystalline powder that easily dissolves in water or alcohol.  Is a Class A controlled substance under the Misuse of Drugs Act 1978, which means it attracts the highest penalties for manufacture, trafficking, sale and use.

How is Methamphetamine Produced?

Meth is manufactured in secret drug laboratories, known as “clan labs”, which can be found throughout New Zealand in houses, garages, outbuildings, apartments, baches and motor vehicles.

Meth is a crystal that vaporises when heated, eg smoking.  Its vapour sticks to surfaces and reforms in crystals.  Should you come into contact with these surfaces, you can ingest the meth through skin.

Short term effects of Meth include rashes, headaches, nausea, dizziness, fatigue, shortness of breath, burning to eyes, skin, mouth and nose.

Long term effects include cancer, brain-kidney & liver damage, miscarriages and birth defects.  Children are at a higher risk as they are closer to the ground and tend to touch surfaces and then suck their fingers.

Every one kilo of Meth made produces five times the amount of waste.  Indications of Meth waste include staining on grass and yellow staining found near drains.

Issues that can arise once Methamphetamine has contaminated a property

Insurance:        Quite often your insurance cover will not cover the full costs to decontaminate a property.  Statistics released in 2015 indicated that the average insurance pay-out to decontaminate a property was $30,000.00.

Police:             Once Meth has been identified at a property and police are notified, this is recorded on the LIM, even if the property is later decontaminated.

Banks:              Lenders do not always have a clear understanding when it comes to Meth contamination in properties and the consequences of the decline in the property valuations.  If multiple properties are owned, then this can affect the loan to value restrictions (“LVR”), and the lender may request additional funds to be repaid to fall within the LVR rules.

Where are the majority of Methamphetamine Contaminated Properties?

The majority of affected properties are in the North Island, however, it is important to note that only houses which are tested are included in the statistics.

Statistics obtained from testing properties in the North Island show that 1 in 3 properties were contaminated.

Appearances can be deceiving.  You cannot look at a property (or its occupants) and simply assume it is not contaminated. Upmarket properties are just as susceptible to contamination as Housing New Zealand properties or rentals.  An example given at a recent seminar was of an agent giving open homes – every time they attended the property they felt dizzy and light headed, but didn’t think anything of it.  The property was later found to be contaminated.

How you can protect yourself?

Become educated.  Be aware of the issue.  You should be asking yourself “how have you satisfied yourself this property does not have a problem with meth residues?”

If you are presenting an offer to purchase a property, then advise the agent (if one is involved) that you would like an additional clause included, making the contract subject to a satisfactory meth test.

You should ensure that all Meth testing is lab based testing of samples rather than kit tests if you want to avoid Meth affected properties.  Other things to look for:

  • Ownership history of the property.
  • The state of the property from the outside.
  • The state of the property from the inside.
  • How you feel when in/after you have been in the property.


For the year 2014/2015 insurance companies had paid out an approximate amount of $20,000,000.00 for Meth contaminated properties.

For the 2015/2016 year insurance companies paid out close to $50,000,000.00 to deal with contamination, a massive increase in one year!

There have been suggestions that insurance companies might limit insurance cover for Meth related claims given the increase in claims.

It is important to note that insurance claims will not cover loss of property value and may not cover all soft furnishings.

Protecting existing assets

If you own rental properties, it is important that regular checks are completed to reduce the risk of contamination and also to ensure that your insurance policy will not be invalid.  In many policies this is a specific requirement.
It is suggested that a “MethMinder” be installed in rental properties.  This is a detection and monitoring system, developed and designed in NZ, that can detect if your property is being used to manufacture methamphetamine.  It is similar in size to a smoke alarm and is visible to tenants.  It is a stand-alone self-powered solution which communicates via the national wifi digital cell network, is fitted with multiple tamper sensors and a control room is notified (silently) if interfered with.  Tenants should be informed from the outset of the device, together with consequences and charges they will face if they tamper with the device.  The alarm activation notifies the nominated contact and possibly the police if required – hopefully this will deter tenants!  Costs start at $49.95 per month (2016) and more details can be found at http://www.methminder.co.nz/faq/.
Conclusion – always undertake due diligence before proceeding!

Any construction or building project will involve a number of people to make it a success. These could include architects, engineers, surveyors, contractors and landscapers. It is important to get the early engagement right on a project and this will generally take the form of a consultancy agreement.

The legal arrangement could be directly between the person who wants to develop the project or they could appoint someone who then engages with the different consultants. Duties will be owed by those consultants to the client and that is why the consultancy agreement is critical because that is where these duties will mainly (but not exclusively) be set out (duties are also inferred by statue and common law).

Generally standard form consultant agreements are drafted by bodies that will be looking out for their member base. Examples are the Institute of Professional Engineers of New Zealand and the New Zealand Institute of Architects. Such documents need to be checked closely and the exclusions and limitations analysed thoroughly to check what they say eg that limits of liability are not set too low.

Key issues for Consultancy Agreements

Some of the key issues to be considering when looking at a consultancy agreement are:

Standard of care: The standard of care in the consultancy agreement will generally be based on market practice. An example of this is in the Conditions of Contract for Consultancy Services 2009 (published by the Institute of Professional Engineers New Zealand Inc.) which says:

In providing the Services, the Consultant must use the degree of skill, care and diligence reasonably expected of a professional consultant providing services similar to the Services.

Scope of services: the services to be provided should be within the expertise of the consultant. When drafting the contract it is important to check if there is a gap between what the consultant is to do (to the standard of care mentioned above) and what others in the project will do. Clear discussions over who exactly does what is very important at the early stage.

Design warranties: These should be included where the design risk is high – eg bespoke buildings. Design warranties may help focus the parties on the key risks and ensure the contractor stands behind it’s work. It may be that a discussion is also needed with the contractor about what insurance it has in place (or needs to take out) so that there is insurance if a design warranty is breached.

Indemnity: These are often the subject of much discussion because a consultant will not want to give indemnities. They are a potential liability where the consultant will have to pay if something in particular happens – and continue to pay where there is ongoing loss. It is important to be clear about what exactly will trigger an indemnity, who it will cover and how much the indemnity will be for. There are a variety of indemnities which may be used and those should be discussed with your lawyer in advance to find the best combination that works in the particular situation.

Limitation of liability and exclusion clauses: These are commonly included and essentially involve one party trying to get out of, or limit, it’s liability. Wording used should be clear, particularly if trying to exclude “consequential” losses. For example, “consequential” may not include loss of profit which may be considered a direct loss. So the wording used will be critical and should be clear.

Insurance: Consultants may try to have their liability linked to their ability to recover funds under an insurance policy. However, that means there is an extra step involved and it may even be possible that the insurance does not respond because it has not yet been triggered by an actual legal liability. The insurance position of the consultant should be clearly understood.

Construction Contract Act: From 1 September 2016 the definition of “construction work” has been expanded and applies to many consultancy agreements eg design, engineering and quantity surveying. This means that certain provisions will be included in Consultancy Agreements eg default provisions relating to payment.

Other issues: Other practical points to be covered in a consultancy agreement are (very briefly):

  • Key people: specify if a particular person is to be involved;
  • Price and payments: how much is paid and when? This may involve setting out milestone and deliverables and a design program;
  • IP: who owns what?;
  • Novation: ability to novate or assign eg if you later want to novate to a contractor;
  • Variations: how will these be requested and priced?;
  • Disputes: how will these be handled?;
  • Reporting: What reports are required and when?;
  • Health and safety: Who is responsible for what and who is a PCBU?;
  • Sub contracting: To what extent will this be done, and who is responsible for this?;
  • and Termination: Ability to terminate and what happens then?

In New Zealand consultants will often put forward a set of the industry standard terms and say “this is non-negotiable” – or words to that effect. These agreements are often signed before a lawyer is even involved. This is in contrast to the situation overseas where consultancy agreements are often drafted for particular projects to address the unique set of circumstances of an individual situation.

We hope these comments help you as you think through the content of your consultancy agreement. We would be happy to discuss your specific situation in detail with you.

We have seen a lot of people make some mistakes when buying a house.  These are the top 10 things to consider when making that purchase… Read more