1Short title
This Act may be cited as the Home Building Contracts Act 1991.
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Explanatory material and speeches for the bills of later Acts that amended this Act, newest first. They explain the amendment, not necessarily the provision you are reading.
This Act may be cited as the Home Building Contracts Act 1991.
The provisions of this Act shall come into operation on such day as is, or days as are respectively, fixed by proclamation.
In this Act unless the contrary intention appears —
associated work includes site works, swimming pools, spas, pergolas, carports, garages, sheds, fencing, retaining walls, paving, driveways, landscaping and other like works;
builder means a person who carries on, or 2 or more persons who together carry on, a business which consists of or includes the performing of home building work for others;
Builders’ Registration Board means the Builders’ Registration Board constituted under the repealed Act;
Building Commissioner means the officer referred to in the Building Services (Complaint Resolution and Administration) Act 2011 section 85;
building licence means building licence issued under the Local Government (Miscellaneous Provisions) Act 1960 section 374 before that provision was deleted by the Building Act 2011 section 153(2);
building permit means building permit as defined in the Building Act 2011 section 3;
construct in relation to a dwelling means perform any work commencing with the preparation of the site and ending with the completion of the dwelling (including any associated work) and includes —
painting where that is part of the work included in a contract; and
the provision of lighting, heating, water supply, drainage, sewerage, gas and other like services;
contract means a home building work contract;
cost plus contract means a contract under which a builder is entitled to recover an amount excluding prime cost items and provisional sums that is not determined at the time when the contract is entered into, being an amount that includes the actual cost to be incurred in —
acquiring materials; and
performing work,
specified in the contract, together with an additional amount that comprises either —
a sum calculated as a percentage of that cost; or
a specified sum,
or both;
date of the contract or date of the variation means the day on which the contract or variation was signed by the last party to sign it;
dwelling means a building occupied or intended for occupation solely or mainly as a place of residence;
home building work means the whole or part of the work of —
constructing or re‑constructing a dwelling including an existing dwelling and/or strata/community title dwelling; or
placing a dwelling on land; or
altering, improving or repairing a dwelling, including a strata/community title dwelling; or
constructing or carrying out any associated work in connection with —
any work referred to in paragraph (a) or (b); or
an existing dwelling, including a strata/community title dwelling;
home building work contract means a contract between a builder and an owner for the performance by the builder of home building work, but does not include —
a cost plus contract;
a contract for the performance of home building work —
for a builder who is in turn obliged to perform the work under another contract; or
if the amount stated in the contract as being payable under the contract for the work is $6 000, or such other amount as is prescribed, or less; or
if the amount stated in the contract as being payable under the contract for the work is $200 000, or such other amount as is prescribed, or more;
owner in relation to a contract means the person for whom or which home building work is to be performed under the contract;
perform in relation to home building work includes —
causing the work to be performed; and
organizing or arranging for the performance of the work;
prescribed means prescribed by regulations;
repealed Act means the Builders’ Registration Act 1939;
strata/community title dwelling means a building or part of a building, occupied or intended for occupation solely or mainly as a place of residence, that is erected on a lot within the meaning of the Community Titles Act 2018 or the Strata Titles Act 1985;
working days means Monday to Friday but excluding in respect of home building work to be carried out in any area a day that is a public holiday in that area or throughout the State.
It is immaterial, for the purposes of the definition of home building work contract, that a contract between a builder and an owner for the performance of home building work also includes work that is not home building work.
[Section 3 amended: No. 58 of 1995 s. 97; No. 76 of 2000 s. 44; No. 37 of 2002 s. 5; No. 16 of 2011 s. 113; No. 19 of 2011 s. 148; No. 32 of 2018 s. 214.]
A contract —
must be in writing —
setting out all of the terms, conditions and provisions of the contract; and
showing the date of the contract;
and
must be signed by the builder and the owner or their respective agents.
A notice containing an explanation of the relevant provisions of this Act is to be prescribed.
The owner must be given a notice referred to in subsection (2) before the owner signs a contract.
A builder who is a party to a contract must ensure that the requirements of subsections (1) and (3) are complied with in respect of that contract.
Penalty: $2 000.
If any requirement of subsection (1) is not complied with by the builder the contract may be terminated by the owner in accordance with section 19.
The owner must be given a copy of the signed contract —
as soon as is reasonably practicable after a contract has been signed by both parties; and
before the home building work is commenced.
A builder who is a party to a contract must ensure that the requirements of subsection (1) are complied with in respect of that contract.
Penalty: $500.
If —
subsection (1) is not complied with by a builder in respect of a signed contract; and
the owner in writing requests the builder to give to the owner a copy of the contract,
the builder must comply with that request within 10 working days of receiving it.
Penalty: $10 000.
[Section 5 amended: No. 76 of 2000 s. 45.]
A document signed by the owner acknowledging receipt of a notice referred to in section 4(2) or of a copy of a signed contract, or both, and showing the date of receipt is evidence that the notice or copy of the contract was received by the owner on that day.
A variation of a contract —
must be in writing —
setting out all of the terms of, and the cost of, the variation;
showing the date of the variation;
and
must be signed by the builder and the owner or their respective agents.
The owner or his agent must be given a copy of the signed variation —
as soon as is reasonably practicable after it has been signed by both parties; and
before the work to which the variation relates is commenced.
A builder who is a party to a variation of a contract must ensure that the requirements of subsections (1) and (2) are complied with in respect of that variation.
Penalty: $500.
This section has effect subject to sections 8 and 13(4) and clause 5 of Schedule 1.
In this section and in section 8 contract includes any previous variation of the contract.
Section 7(1) and (2) does not apply to a variation of a contract that is made necessary by —
any written direction lawfully given by a person acting under a written law; or
circumstances that could not reasonably have been foreseen by the builder at the time when the contract was entered into,
if the builder gives to the owner, within the time allowed by subsection (2), a statement setting out the reason for, and the cost to be incurred on account of, the variation and a copy of any direction referred to in paragraph (a).
A statement under subsection (1) must be given within 10 working days after the builder —
received notice of the direction under paragraph (a); or
became aware, or should reasonably have become aware, of the circumstances referred to in paragraph (b),
of that subsection, as the case may be.
Where —
a statement is given to the owner by the builder for the purposes of subsection (1)(b); and
the owner considers that the variation is not one to which subsection (1) applies,
the owner cannot make a complaint as provided in section 17 unless the owner makes the complaint within 10 working days after the statement was given to the owner.
Subsection (1)(b) does not enable a builder to vary a contract, except in accordance with section 7(1) and (2) or 13(4) or clause 4 of Schedule 1, by reason only of an increase in the costs of labour (including related overhead expenses) or materials, or both, to be incurred by the builder.
[Section 8 amended: No. 14 of 1996 s. 4; No. 76 of 2000 s. 46; No. 16 of 2011 s. 114; No. 24 of 2011 s. 163(2) and (3).]
Subject to subsection (5) every contract is conditional upon —
a building permit being granted, in respect of the home building work included in the contract, within 45 working days from the date of the contract; and
where a condition is attached to the permit which will result in a variation of the contract, the owner and the builder acknowledging in writing within that period that each of them accepts that condition; and
it becoming lawful under the Water Services Act 2012 section 82, within 45 working days from the date of the contract, for the home building work to be commenced; and
where a direction is given by a licensee under the Water Services Act 2012 section 82 in connection with the carrying out of the work which will result in a variation of the contract, the owner and the builder acknowledging in writing within that period that each of them accepts that direction.
It is a term of every contract that —
the builder will —
do all things that are reasonably necessary to be done to ensure that any condition referred to in subsection (1)(a) and (c) applicable to the contract is fulfilled; and
not unreasonably decline to accept a condition or direction referred to in subsection (1)(b) or (d) that applies to the contract;
the owner will —
do all such things as may be required to be done by the owner to ensure that any condition referred to in subsection (1)(a) and (c) applicable to the contract is fulfilled; and
not unreasonably decline to accept a condition or direction referred to in subsection (1)(b) or (d) that applies to the contract.
If a builder properly submits to the relevant authorities within 20 working days after the date of the contract all necessary applications required for the purpose of having conditions referred to in subsection (1)(a) and (c) fulfilled, the builder is to be taken to have complied with the builder’s obligations under subsection (2)(a)(i).
If a condition implied by subsection (1) is not fulfilled the consequences to, and the rights and remedies of, the parties are as set out in Schedule 1.
A condition referred to in a paragraph of subsection (1) does not apply to a contract —
to the extent that the subject matter of the condition was completed before the contract was entered into; or
where the only work to be performed under the contract is the construction or carrying out of associated work; or
for any other prescribed home building work.
[(6) Deleted.]
[Section 9 amended: No. 73 of 1995 s. 188; No. 14 of 1996 s. 4; No. 76 of 2000 s. 47; No. 37 of 2002 s. 6; No. 24 of 2011 s. 163(4) and (5); No. 25 of 2012 s. 217.]
A builder must not enter into a contract which provides that the builder is entitled to demand or receive from the owner any payment —
before the commencement of the home building work to which the contract relates unless the payment is —
a deposit of not more than 6.5% of the total amount payable to the builder under the contract for the home building work; or
of a prescribed kind;
after the commencement of the home building work unless the payment is —
a genuine progress payment for work already performed or materials or services already supplied; or
is of a prescribed kind.
Penalty: $10 000.
Where a contract provides for the purchase by the owner of materials for a dwelling in a prefabricated form or of a dwelling that is transportable or for a similar arrangement, a payment for the materials or dwelling and associated work is a genuine progress payment for the purposes of subsection (1)(b)(i) —
if property in the materials or dwelling passes absolutely to the owner on the payment being made; and
notwithstanding that the materials or dwelling are not placed on or affixed to the land of the owner.
Where —
a contract sets out a schedule of payments due at specified stages of the home building work; and
a payment is demanded or required in accordance with that schedule,
the payment is to be taken to be a genuine progress payment for the purposes of subsection (1)(b)(i) until the contrary is shown.
If a builder enters into a contract in breach of subsection (1), the contract may be terminated by the owner in accordance with section 19.
A builder under a contract must not demand or receive from the owner any payment after the commencement of the home building work unless the payment is a genuine progress payment for the purposes of subsection (1)(b)(i) or of a prescribed kind under subsection (1)(b)(ii).
Penalty: $10 000.
[Section 10 amended: No. 76 of 2000 s. 48.]
It is a term of every contract that the builder is liable to make good at the cost of the builder defects in the home building work notified in writing to the builder within the period of 4 months commencing on the day of practical completion.
Nothing in subsection (1) prevents a contract from providing for a period greater than 4 months as the period within which the notification referred to in that subsection must be given.
In subsection (1) —
defect means a failure —
to perform the home building work in a proper and workmanlike manner and in accordance with the contract; or
to supply materials that are of merchantable quality and reasonably fit for the purpose for which the owner required the home building work to be performed,
not being a failure for which the builder is specifically declared by the contract to be not liable;
practical completion means brought to the stage where the home building work is completed except for any omissions or defects which do not prevent the home building work from being reasonably capable of being used for its intended purpose.
The regulations may provide for exemptions from the requirements of this section.
[Section 11 amended: No. 76 of 2000 s. 49.]
A builder must not enter into a contract that contains an amount or an estimated amount for a prime cost item or a provisional sum if the amount or estimated amount is misstated by being less than the least amount that it could reasonably cost to supply the item or perform the work to which the amount relates.
Penalty: $10 000.
In determining whether an amount is misstated for the purposes of subsection (1) regard is to be had to the matters or contingencies that were known (which may be set out on the contract), or ought reasonably to have been known, to the builder at the date of the contract.
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