Home building and renovating

Under the Home Building Act 1989 (NSW), you can cancel a contract for home building work with a limited penalty (or in som​e circumstances no penalty) if the amount of the contract is more than $20,000 and you give notice to the builder or contractor in writing within:

• five business days of when you sign or receive a copy of the contract, or
• seven days of becoming aware that the contract should have contained a cooling-off period and did not.

Home building compensation

If the home building work was not completed, you have 12 months to make a Home Building Compensation claim. 

If the home building work was completed, you have:

• six years from the completion of the work for losses arising from major defects
  
• two years from the completion of the work for losses arising from defects that are not major defects.

If the loss becomes apparent in the last six months of the time limit, you have another six months to make a claim.

No claim can be made more than 10 years after the building work is completed. 

Major defect

You have six years to start a case in the NSW Civil and Administrative Tribunal (NCAT) or court for breach of the Home Building Act statutory warranties where the breach results in a major defect in residential building work.

Note: The two and six year statutory warranty period starts from completion of the work, or if the work was not completed:

• on the date the contract is terminated
• if the contract is not terminated - the date the work under the contract ceased, or
• if the contract is not terminated and the work under the contract was not commenced - the date of the contract.

If the breach of warranty becomes apparent within the last six months of the warranty period, you may apply to NCAT or Court within a further six months after the end of the warranty period.

If the residential building work involves the construction of a new building in a strata scheme, the date of completion of the work is usually the date of issue of an occupation certificate for the dwelling.

To make a consumer claim to the Consumer and Commercial Division in NCAT from:

• when the goods or services were supplied, or
• the goods or services were meant to be supplied, or 
• in some cases, when you found out about a problem with the goods or services.

The application must also be made within a maximum of 10 years of the goods and services being supplied.

Set aside or vary an order of NCAT

In the Consumer and Commercial Division of NCAT, you have seven days from when an order was made to apply for it to be set aside or varied.

An order may be set aside or varied if:

• you and the other party agree, or
• the decision was made without you or the other party being present.

It may be possible to get an extension of this time, but you should get legal advice about your circumstances.

If an order was made by NCAT you have 28 days to seek leave from the date you were notified of the decision, orally or in writing (whichever is later), to make an internal appeal. 

If you are unsuccessful with an internal appeal, you have 28 days to appeal the decision to the Supreme Court of NSW, but you can only appeal on a question of law. 

Renewal of Proceedings

If a work order has been made by NCAT and it has not been complied with, a renewal application must be made within the time specified in the orders. If no time limit was specified, then the application should be made within 12 months after the work was meant to be completed. 

Reinstatement application

You have seven days from the date of dismissal to apply to have proceedings reinstated if you applied to the Consumer and Commercial division of NCAT and your matter was dismissed because you missed a hearing date, You must have a reasonable excuse for not attending.

It may be possible to get an extension of this time, but you should get legal advice about your circumstances.

The District and Supreme Courts may hear Home Building Act 1989 (NSW) matters above $500,000 in certain circumstances.

The Home Building Act regulates home building work in NSW and disputes about home building work. It requires builders and most tradespeople to:

• be licensed
  
• hold relevant insurance
• give you a written contract for most work.

The Act gives jurisdiction to: 

• NSW Fair Trading to investigate building disputes and make rectification orders 
  
• State Insurance Regulatory Authority (SIRA) to regulate insurers 
  
• NSW Civil and Administrative Tribunal (NCAT) to deal with building claims where the amount claimed is less than $500,000.

The Competition and Consumer Act 2010 (Cth) outlines consumer protection laws and adopts the Australian Consumer Law in Schedule 2 of the Act. The ACL  provides some protections for consumers who have problems with home building work.

​Building element

​A building element is anything that is likely to have significant impact on the safety and quality of a building, including:

• fire safety systems
• waterproofing
• building structure
• building enclosure
• building services.

It does not include superficial elements, such as:

• interior design
• surveying
• painting
• landscaping.

A legally binding agreement or promise. Generally, a contract may be oral or in writing, or partly oral and partly written. 

Contracts for home building work over $5,000 must be in writing (this amount increased from $1,000 for contracts entered before 1 March 2015). 

If the home building work is over $20,000 contracts must contain more information than those for 'small jobs' (this amount was increased from $5,000 for contracts entered before 1 March 2015).

​Federal jurisdiction problem

​When NCAT may not determine certain applications because the Constitution does not allow it. 

For example, if one party is a permanent resident in NSW and the other party is a resident of a different state, NCAT will not be able to determine the matter.

There is no federal jurisdiction problem if one of the parties is:

• a resident of a territory
• a non-permanent resident of a different state
• living overseas
• a corporation
• a government agency.

• the construction of a building
• making alterations or additions to a building
• repair, renovation or protective treatment of a building. 

Any defect in a major element of a building that arises from defective design, defective or faulty workmanship, defective materials or failure to comply with the structural performance requirements of the National Construction Code (or any combinations of these) that results, or is likely to result in:

• inability to live in or use the building or part of the building
• the destruction of the building or any part of the building, or
• threat of collapse of the building or any part of the building.

• Any internal or external load-bearing part of the building that is essential to the stability of the building or any part of it, including things such as foundations, floors, walls, roofs, columns and beams.
• Fire safety system or waterproofing.

• prepared for a building element (waterproofing, structural element)
• prepared for a performance solution
• of a class in the regulations. 

​A residential apartment building, also known as a class 2 building, is a building that has two or more sole-occupancy units that are separate dwellings. It can include:

• multi-unit, multi-storey residential apartments
• a house with a granny flat on a second storey
• two single-storey dwellings that are attached and have a common space below.

Residential building work

(also called home building work)

The Home Building Act 1989 (NSW) defines roof plumbing work as work that involves fixing, installation, renovation, alteration, repair and maintenance of guttering, downpipes, roof flashing and roof coverings on any dwelling (home). 

It does not include work on roof coverings where the roof coverings are non-metallic tiles and slates, or glass, or concrete, or timber and timber products, or thatching, or malthoid, bituminous or similar membrane material.

Fees at NCAT

If you can't afford to pay the fee, you can apply to for an exemption, reduction or waiver. For more information, see Reduced fees and fee waivers on the NCAT website.

• less than $10,000 - each party usually pays their own legal costs. Cost orders are only made where NCAT is satisfied that there are special circumstances.
• $10,000 - $30,000 -  NCAT can order costs where there are special circumstances or if a party is conducting proceedings in a way that unreasonably disadvantages any other party
• more than $30,000 - NCAT can make costs orders as it thinks fit.