New consumer protection for residential building works

The Building Amendment Act 2013 came into force on 1 January 2015, requiring additional obligations in residential building contract. The Act defines a residential building contract as building work in relation to a household unit, but does not include subcontract.

The purpose of the amendment is to provide further protection for residential homeowners. To this end, the Act imposes the following requirements among others:

  • Prior to entering into a residential building contract,  contractors must now disclose information in regard to their skill, qualifications, licensing status and their track record. Non-disclosure may incur a penalty of up to $2,000 and misleading disclosures may incur a penalty of up to $20,000.
  • All residential building contract for a value over $30,000 must be in writing, dated and complies with relevant laws and regulations.
  • All residential building contracts includes a implied warranty that the building work was carried out in a competent manner and that the materials used were suitable and fit for purpose. Further, that all building work was carried out in accordance with all laws and regulations, and with reasonable care and skill.
  • Requiring the contractor to remedy any defects that arise within 1 year of completion upon receiving notice by the homeowner.
  • Upon completion of the work, the contractor must provide the owner with documentation that identify the building contractor, any warranty or insurance obtained and any maintenance required for the building.

These amendments are a step forward in ensuring ensure consumer protection for residential owners. Homeowners are likely to be more informed and better equipped to make decisions about their building projects. The measures should also assist in holding the contractors accountable for the work they have done.

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