• Construction agreement conditional cancellation

I have an unregistered construction agreement (CA) with a builder. This agreement is signature verified and notarised, but is not registered. This agreement has also a clause for guarantee of construction for two years.

I found that the builder is not constructing as per the plan and has not taken proper measures in foundation. Hence I stalled the construction. I had paid him to the stage up to ground floor as per CA.  After, this I had sought help of structural engineers and found that the foundation is weak and that it will require grouting of foundation for further construction.

The builder did review all the reports and videos and accepted the fault in foundation. There is no written communication in this regard. I asked him to refund the excess money along with the cost of expenses (doing the composite test and payment to structural engineers) and also the approximate grouting expenses to be incurred.

In the span of about 6 months, he has refunded to me about 60% of the total sum so far. Now he says he does not have money now and would pay as and when he has funds.

I would like to restart my construction with another structural engineer/builder.  

1.	Can I cancel this CA using a clause of pending dues from the old builder and then restart the construction?
2.	Will such a cancellation hold good if I go to court of law later if he does not pay my dues?

Can you please guide me on this?
Asked in Property Law from Chennai, Tamil Nadu
Religion: Hindu
1) it is necessary to peruse the construction agreement signed with builder

2) you can terminate contract if builder  has committed breach of contract 

3) it is better you have your agreement vetted by local lawyer . based on his guidance terminate the contract and seek   recovery of money payable to you 
Ajay Sethi
Advocate, Mumbai
28432 Answers
1542 Consultations

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1. You mag issue a lawyer's notice to the builder to cancel the agreement to seek the refund of the balance amount.

2.  A civil suit for recovery of money can be filed against him if he does not refund
Ashish Davessar
Advocate, Jaipur
19897 Answers
518 Consultations

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