July 2020
also give you prescribed information about certifiers, published by Fair Trading, before entering into a contract. It is an offence for a contractor to unduly influence your choice of a certifier or object to your choice. Examples of undue influence include: making it a requirement of the contract that a specified certifier or class of certifier is or isn’t appointed offering to change the contract price if a specified certifier or class of certifier is or isn’t appointed refusing to carry out work under the contract if a specified certifier or class of certifier is or isn’t appointed. Residential building contracts regarding work worth more than $20,000 requires a full home building contract. As well as all of the requirements of the 'small jobs' contract, it must include other comprehensive information such as the details of the statutory warranties the builder must provide, the cost of any applicable HBC cover and the contract price or warning that the contract price is not known. The contract must also include a checklist prescribed by Fair Trading. Find a complete list of contract requirements on our website. All contracts over $20,000 in value must have a progress payment schedule. Progress payments must match the work carried out and, for cost plus contracts, be supported by receipts or other verifying documents. Any change you need to make to a contract is a ' variation '. Variations must be in writing and be signed by both parties to the contract. Almost all will impact the contract price. The maximum deposit you can be asked to pay before work starts is 10%. Common traps and tricks Beware of: ● an extremely low quote compared with others. This may indicate the job's quality is being compromised, or that the builder may not fully understand what is required ● `sales pitches´ putting pressure on you to sign a contract quickly to avoid a price increase ● a builder who recommends you get an owner-builder permit while they organise all the building work. The builder may be trying to avoid responsibility and may
not have the right kind of licence or HBC cover. When things go wrong Statutory warranties Builders and tradespeople must guarantee that their work is fit-for-purpose, performed diligently and delivered in a reasonable timeframe, in line with the contract. Unless otherwise specified, materials should be new and appropriately used. These warranties are time-limited: legal proceedings to enforce them must be commenced within 6 years for major defects and 2 years for all other defects. There is another 6 months for both warranty periods if the defect only became apparent after 18 months or 5 and a half years. Find out more about these warranties on the Fair Trading website. Resolving a dispute with your builder or tradesperson These steps can help you resolve a dispute: ● you must notify your builder or tradesperson and discuss concerns as soon as you become aware of a problem. Follow up with an email or letter ● understand acceptable work standards by downloading the Guide to Standards and Tolerances from our website ● contact Fair Trading for free dispute resolution if you and your builder or tradesperson are unable to resolve the dispute ● lodge a claim with the NSW Civil and Administrative Tribunal (NCAT) if you remain unsatisfied with the dispute resolutionoutcome ● protect your rights under the HBC Scheme : contact your insurer or provider as soon as you become aware of defective or incomplete work. Home building compensation disputes For help resolving disputes with a HBC insurer or provider, visit the SIRA website sira.nsw.gov.au or call 13 10 50.
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