I am a plumber and my builder has gone broke. What are my rights?
I have been a subcontracting plumber for the same builder for the last five years. Things were good when the mining boom was on as there was plenty of work.
Recently my builder has been stiffed on a large building contract where the developer has gone broke and can’t pay him.
Consequently he has told me he can’t pay me.
I am owed almost $30,000. This is a lot of money to me and I might have to go to the wall if I don’t get paid.
Is there anything I can do?
Unfortunately, things do not look good for you.
As you are no doubt an unsecured creditor, you will be the last in line to get anything back when either the developer or the lead contractor goes bust.
Subcontractors have little choice but to take the risk of being unsecured creditors – if they try to demand more secure payment terms from a head contractor, it can simply go elsewhere.
Whilst there is legislation aimed at protecting subcontractors, they often involve a costly and time-consuming process for subcontractors, and a finding that a subcontractor is owed money is all but worthless if the head contractor or the developer is insolvent.