Defect list after handover: your first response in the first week
Respond in writing within 48 hours
When a defect list arrives weeks after you handed over the keys and sent the final invoice, your instinct may be to phone the client or discuss it on site. Do not.
Write back immediately. Acknowledge that you received the list, confirm the date you received it, and state that you are reviewing each item. This creates a record that you took the notice seriously and responded promptly.
Do not admit fault, agree to fix everything on the list, or concede that payment should be withheld. Simply confirm receipt and say you will provide a detailed response within a short, specific timeframe such as five business days.
Separate genuine defects from tactical claims
Go through the list item by item. Write down which claims relate to work you actually did, which refer to damage that occurred after you left site, and which describe things the client now wants but never agreed to in the contract.
Genuine defects are faults in work you completed that do not meet the agreed standard or specification. Variations the client requested verbally but never approved, wear and tear, damage caused by others after handover, and vague complaints without supporting evidence are not defects you are obliged to remedy.
For each disputed item, note why you dispute it. Keep this analysis in your own file. You will use it to draft your formal response.
Check your contract terms and the timing
Find your signed contract and read the defect liability clause. Confirm how long the defect period runs, when it started, what counts as a valid defect notification, and whether the contract allows the client to withhold your entire invoice or only a reasonable amount to cover the cost of fixing genuine defects.
If the defect list arrived after the contractual defect period expired, the client may have limited grounds to rely on it. If it arrived within the period but refers to items that were signed off or inspected earlier without complaint, note that as well.
Timing matters for another reason. If you have already issued a payment claim and no payment schedule was served within the required timeframe, the client may not be able to rely on defects raised later to withhold payment under security of payment legislation. Get advice if this applies to your situation.
Source: NSW Fair Trading , Contracts for residential building work
Draft your formal response and set a deadline
Prepare a written response within the timeframe you promised. Address each item on the defect list. For items you accept, state what you will do and when. For items you dispute, explain why clearly and briefly.
Where you dispute an item, provide your reason: the work was signed off at practical completion, the issue is outside your scope, the defect was not caused by your work, or the complaint is too vague to assess. Attach supporting documents such as signed handover records, photos from completion, or contract clauses.
Finish your response by requesting that the client confirm which items remain in dispute and provide evidence for any claim you have contested. Set a reasonable deadline for their reply, typically seven days. State that you expect payment of your invoice by the due date, or if they intend to withhold an amount, they must specify exactly how much and provide a detailed breakdown of the estimated rectification cost.
Protect your payment claim rights under security of payment law
If you have issued a valid payment claim and the client has not provided a compliant payment schedule within the time allowed, they may not be able to rely on the defect list to withhold payment. The timing and process matter.
Under security of payment legislation in most states, a respondent who wants to withhold payment must serve a payment schedule within a strict timeframe, typically ten business days, stating the amount they propose to pay and all reasons for withholding any part of the claimed amount. Reasons not included in that payment schedule generally cannot be raised later in adjudication or court.
If the defect list appears to be a tactic to avoid responding properly to your payment claim, get advice promptly. Security of payment laws have short, rigid deadlines. Your rights depend on acting within those windows.
Decide which items to fix and which to dispute
If some items on the list are minor, inexpensive to fix, and clearly within your responsibility, consider fixing them quickly. Removing easy wins from the dispute can shift the focus to the tactical or inflated claims that should not have been raised.
Do not agree to remedy work you did not do, damage you did not cause, or variations that were never approved. If you fix disputed items without documenting that you are doing so without admission, the client may later argue you accepted responsibility.
Make your decision based on cost, time, and leverage. Fixing a genuinely defective door latch is different from repainting a room the client now wants in a different colour.
Press for payment and escalate if necessary
Throughout this process, continue to press for payment of your invoice. A defect list does not automatically cancel the debt or give the client an indefinite right to withhold money.
If the client refuses to pay and the defect claims do not justify the amount being withheld, you may need to escalate. Depending on your contract, the amount owed, and whether you have followed security of payment procedures, your options may include adjudication, formal demand, or court action.
Get advice before you escalate, but do not let the matter drift. Defect lists that arrive weeks after completion are often part of a strategy to delay or reduce payment. Respond quickly, document thoroughly, and protect your legal position from day one.