VARAICH HOMES
CRITICAL INFORMATION FOR CUSTOMERS AFFECTED BY THE LIQUIDATION OF VARAICH HOMES PTY LTD ALSO KNOWN AS HARCON PROPERTY GROUP PTY LTD
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On 18 September 2024 Varaich Homes Pty Ltd was placed into liquidation.
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For any customers affected by Varaich Homes we encourage them to approach Kapadia and Gordon Lawyers. We are familiar with what Varaich homes has done in the past and we are well placed to advise and assist anyone affected by them.
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The purpose of this article is to help increase awareness among customers of builders and share what many unfortunate Varaich customers have gone through. These problems are not unique only to Varaich Homes, there are many bad builders who choose the flout the rules and take advantage of homeowners in a vulnerable position. Many of these home owners are trying to build their dream home but instead get left in limbo for months paying a large mortgage for the building project as well as either renting or paying a second mortgage as well.
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Varaich Homes Pty Ltd have a track record and history of failing to appropriately take out or maintain insurance on behalf of building customers. For one of our client’s, he entered into a contract in of almost $1 million dollars, and persistently failed to obtain his Domestic Building Insurance ultimately leading to the termination of the contract. This was not only in breach of the terms of the contract, but also illegal. He has done this multiple times.
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Further Varaich has a history of approaching customers and effectively forcing them to pay him in advance prior to completion of their building stage. His story is often to the effect that he will not be able to progress the work until and unless he is paid for the stage in advance. This is again conduct which is not permitted by the building contract. There are even occasions where he is yet to complete one stage, and commences the next stage. For example, multiple clients have stated that he has commenced roofing works and the lock-up stage prior to completion and approval of the frame stage. This is illegal as well.
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One of the most concerning aspects of this builder is that even after the customers have paid, the works do not progress and trades are not paid. This leads to instances where trades become furious with the builder and then in a desperate attempt to pressure Varaich to pay them, they contact home owners asking for help. When all else fails they resort to taking back their work, which in less elegant terms means that they break the work they have done on site. This includes everything from brick laying works, to taking away already installed doors and windows.
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The real question this all raises is whether Varaich Homes is genuinely insolvent, or whether he has pocketed the money and is just ‘crying poor’. This is a matter which will be left up to the liquidator to determine. Liquidators have wide ranging powers to investigate the builder’s financial affairs, and also set aside thew following types of transactions:
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Unfair preference payments;
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Uncommercial transactions;
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Insolvent transactions;
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Unfair Loans;
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Unreasonable director related transactions; and
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Creditor defeating dispositions.
In recent times as well, Varaich Homes has also been doing work under the building license of Faridkot Pty Ltd. And so many customers who were dealing with Varaich Homes need to carefully check their contract to ensure that they liaise with the correct builder following the liquidation. We are aware of at least three instances where this has occurred, and there may be more. If a customer’s contract does state Faridkot Pty Ltd as the builder, they may have the right to continue to enforce the building contract against them to have their home finished. However, it is best to consult a lawyer to receive formal advice on this issue.
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It is always advisable to seek legal advice promptly and early to ensure the customer’s rights are safeguarded and protected. Generally speaking, the sooner, a person consults a lawyer, the better the outcome will be.
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This article is provided for the purposes of general information and is not legal advice. If you have a Domestic Building Dispute or an issue with a builder, please contact us directly for tailored specific legal advice.