Sheng Guo and his partner Maggie Law have had their final inspection on their home delayed nearly a year after a dispute over the driveway with their builder. Photo / Brett Phibbs
Maggie Law’s 2 year old son peeked over his arm.
Their future looks secure as they sit comfortably in the lounge of their newly built Bucklands Beach dream home east of Auckland – but Law doesn’t smile.
He said a dispute with their builder had delayed approval of the final inspection of their home by almost a year and pushed them to the brink of financial collapse.
He then took builder Jared Guojun Cha and his I Home Furture company to Dispute Court, winning a $ 30,000 payment.
But Cha puts the company into voluntary liquidation, leaving Law feeling he has little hope of seeing the cash owed him.
Cha told the Herald on Sunday that his company had no money to pay and that he had no regrets because he thought the Dispute Court ruling was unfair.
Law says he now wants to warn others about Cha – who continues to run another building company – as well as the risks of hiring an unproven builder versus using a leading brand.
Law’s new home is just one of thousands mushrooming across Auckland as developers rush to fill the city’s housing shortage and cash in on soaring selling prices.
But while most have been built by professional developers, mothers and fathers are also increasingly devoting their attention to building projects.
Law and his partner Sheng Guo formed their idea of building the dream family home after purchasing the Bucklands Beach mansion built in the 1970s on a 597 square meter block in 2014.
Then – after meeting Cha at a party – they pushed forward in 2019 with plans to hire his team to manage the project and build a new home behind their property, allowing them to then rent or sell the house that is up front.
Cha not only offered to build a new home for $ 420,000 – cheaper than most major building brands – but Guo had known him in the past as well.
Guo and Cha previously studied English in Palmerston North together and are from the same hometown in China.
At first the construction of the house went well, with the couple enjoying a good working relationship with Cha.
But towards the end of the project in early 2020, after most of the houses had been built, problems arose with concrete work on the driveways, Law said.
Cha argued that some of Law’s concerns over entry were not things he had to deal with; including for the concrete driveway near the old house.
Access roads on newly built properties need to be installed with permeable concrete so that rainwater can seep into the ground rather than flooding neighboring roads or properties, Law said.
He claimed Cha had no experience installing permeable concrete.
He then refused to repair his work or to concrete the remainder of the shared driveway that stretched from the new house to the old house, he said.
Cha then dropped the tool on the dispute.
That leaves the final building inspection of the house still unfinished nearly a year later, while rubbish remains strewn across the courtyard and the decking and retaining walls also remain unfinished.
The delay also left Law and Guo to pay off two mortgages and unable to rent or sell the existing front home to cover part of their costs.
The Dispute Court will later side with Law, saying evidence shows Cha had misplaced the concrete and that he was also responsible for concreting the remainder of the shared driveway.
Cha told the Herald on Sunday that he respects the Dispute Court, but considers the decision unfair because he doesn’t have enough time to prepare evidence himself.
He also said it was unfair to expect him to make concrete in the driveway near the old house because he had been hired to build the new house.
“From our point of view, building a new house is building it within the boundaries of the new property, not outside the boundaries,” he said.
He said he had spent $ 390,000 on building the house, leaving a small margin of the $ 420,000 payment.
“I don’t want to go into liquidation, but when you suffer a customer this difficult, you have no choice,” he said.
He said that Cha had founded I Home Furture solely to build his house.
He then appears to be structuring it without assets so that it acts like an empty company to take payments from him and make payments to his subcontractors, Law said.
That means it appears to have no assets and little cash that can be reclaimed in a dispute, Law said.
And while that’s a common way of structuring companies in the building industry, Law says he now hopes he has written more protections into his contracts.
That could include clauses that require Cha to be personally responsible for the project or one to withhold a larger share of the $ 420,000 payment until the house is completed, he said.
Law now believes these additional requirements are needed with new builders.
“I think a well-known company will never liquidate over $ 30,000, so you can trust they will finish your payment, complete your project and do whatever they can to make sure they maintain a good brand name,” said Law.
After desperately borrowing from friends and family, the couple now needed a further bank loan as Cha $ 30,000 wouldn’t pay them off so they could complete the driveway and get final building approval for the property.
“I’m just grateful that we have come this far because I think a lot of people will be left in the rubble,” said Law.