The Home Building Act 1989 (NSW): What is it? What work does it apply to? What rules does it include?
The Home Building Act 1989 (NSW): What is it? What work does it apply to? What rules does it include?The Home Building Act 1989 (NSW) (“the Act”) is the primary legislation governing residential building work in NSW. It is mainly focused on rules applied to contractors and tradespeople for the protection of consumers in relation to home building.
The Act protects homeowners by establishing minimum standards of fairness and transparency in contractual terms as well as ensuring a level of quality in the performance of residential building work.
What types of residential building work are covered?
Not all work that is undertaken in or around a residential building will be subject to the rules. The Act defines ‘residential building work’ as any work exceeding $5,000.00 in value (including co-ordination or supervision) involved in:
- the construction of a dwelling, or
- the making of alterations or additions to a dwelling, or
- the repairing, renovation, decoration or protective treatment of a dwelling.
A ‘dwelling’ is any building designed, constructed or adapted for use as a residence, including:
- detached or semi-detached houses
- terrace or town houses
- duplexes
- villa-homes
- strata or company title home units, and
- residential flats.
Structures or improvements built for use in conjunction with a dwelling also fall within the definition including (but not limited to):
- swimming pools or spa
- detached garages, workshops, carports, decks, verandahs and pergolas
- driveways, paths, paving, fences and gates
‘Residential building work’ includes:
- roof plumbing work
- general plumbing and drainage work
- gas fitting work
- electrical wiring work
- certain refrigeration work or air-conditioning work
‘Residential building work’ does not include:
- demolition work
- internal painting work (unless part of a broader contract for work), or
- work in relation to moveable dwellings.
What rules does the Home Building Act include?
The requirements of the Act include:
- A requirement for contracts to be in writing with certain mandatory terms
- An obligation for contractors to provide certain consumer information to home owners
- Rules in relation to contract documents and variations to contracts
- A limit on the amount payable as a deposit (maximum deposit)
- Requirements in relation to a contractual cooling-off period
- A system for authorised progress payments
- Requirements for trade and contractor licenses and qualifications
- A requirement for compliant insurance
- Warranties in relation to workmanship and the quality of building materials (the Statutory Warranties), and
- A process for resolving building disputes and building claims.
These rules present a powerful suite of statutory protections for homeowners who purchase goods and services in relation to residential building work. Alternatively, breaching the rules can have serious consequences for residential building contractors (and subcontractors) seeking to enforce their rights or recover costs for goods and services provided under a home building contract.
In our coming series of articles, we will deal in detail with each of the rules set out above.
Jason Francis
