Home Building Contracts Act 1991

A builder must not enter into a cost plus contract with an owner for the performance of home building work unless the contract is in writing and the written contract —

has a heading at the beginning that includes the words “cost plus contract”; and

contains an acknowledgment by the parties that the contract is a cost plus contract and that this Act, apart from this section and Part 3A, does not apply to the contract.

Subsection (1) does not apply to a cost plus contract that comes within paragraph (b) of the definition of home building work contract in section 3.

If a builder enters into a cost plus contract in breach of subsection (1), the contract may be terminated by the owner in accordance with section 19.

A builder must not —

in connection with the formation or execution of a contract or negotiations to vary a contract after execution, or the circumstances in which the contract or variation of contract is entered into, engage in conduct that is unconscionable, harsh or oppressive; or

enter into a contract that contains any provision that is unconscionable, harsh or oppressive.

Without limiting the generality of subsection (1) regard may be had to the following for the purposes of that subsection —

the relative strengths of the bargaining positions of the builder and the owner; and

whether, as a result of conduct engaged in by the builder, the owner was required to comply with conditions that were not reasonably necessary for the protection of the legitimate interests of the builder; and

whether the owner was able to understand the contract; and

whether any undue influence or pressure was exerted on, or any unfair tactics were used against, the owner or a person acting on behalf of the owner by the builder or a person acting on behalf of the builder.

A provision of a contract must not be called in question under subsection (1)(b) by reason only that it entitles the builder —

by notice in writing given at any time before the commencement of the home building work to require the owner to satisfy the builder —

that the owner has title to the land on which the work is to be performed; and

by production of evidence in writing, that the owner is able to pay the contract price;

by notice in writing given at any time before the commencement of home building work that is to be performed by way of a variation of a contract to require the owner to satisfy the builder, by the production of evidence in writing, that the owner is able to pay the price agreed for that work;

if the owner fails to satisfy the builder as mentioned in paragraph (a) or (b) within 10 working days of receipt of a notice under that paragraph, to terminate the contract or the variation, as the case may be, by notice in writing given to the owner within a further 10 working days.

The State Administrative Tribunal may approve a form of contract submitted to the Building Commissioner for an opinion on whether any provision is in breach of subsection (1)(b) and a provision in a form so approved must not be called in question under that subsection.

Forms of contract for various kinds of home building work may be prescribed which are to be taken to comply with all the requirements of this Act.

This section is enforceable as referred to in section 17 and not otherwise.