LSB September 2019_Web

More documents

Recommendations

Info

BUILDING & PROPERTY LAW Making & handling complaints against builders CONSUMER & BUSINESS SERVICES As the State’s consumer watchdog, Consumer and Business Services (CBS) is responsible for regulating South Australia’s building, plumbing, gas fitting and electrical industries. CBS administers the following building-related laws, alongside a raft of other legislation aimed at protecting South Australian consumers: • Building Work Contractors Act 1995 • Plumbers, Gas Fitters and Electricians Act 1995 • Australian Consumer Law (adopted under the Fair Trading Act 1987) There are over 55,000 registered building, plumbing, gas fitting and electrical licences in SA – and this represents approximately 77% of CBS’ occupational licences. The building industry is a key focus for the agency as it has a significant effect on South Australian consumers, both in terms of dollars and emotional impact. Building disputes can also be quite complex and substandard work can pose a risk to public safety. TYPES OF ENQUIRIES AND COMPLAINTS Unsurprisingly, building disputes are consistently in the top three categories of complaints received by CBS. In the first six months of this year alone, CBS has received more than 1940 enquiries, and 223 formal complaints. This includes complaints relating to shoddy work by plumbing, gas fitting and electrical tradespeople, as well as other building issues. The most common complaint received last year related to solar panel installations with more than 130 complaints received from unhappy customers. Other complaints included grievances around new home constructions, home additions and renovations, concrete foundations and other concrete services, bathroom and laundry renovations, and fencing. AVOIDING ISSUES WITH BUILDERS When building a home, it’s important to understand the rights of consumers and builder responsibilities. Consumers are responsible for paying for the building work stated in the building contract and to communicate any particular preferences, changes or concerns. Builders are responsible for building the home in line with the approved plans and contract documents. There are a number of key things to consider before and during the building process. USING A LICENSED BUILDER It’s crucial to ensure the builder holds a current Building Work Contractor’s Licence, and their supervisor holds a Supervisor’s Registration. If the builder is using subcontractors, these tradespeople must also be licensed. The Licensing Public Register on the CBS website contains details of all licensed builders in South Australia. CONTRACTS There must be a written contract for any building work costing $12,000 or more, which will usually contain a number of documents including drawings and specifications. The contract must: • be in writing • be legible • set out all of the agreed terms in full • include the name and licence number of the building work contractor and contractor’s business partners • be signed by both the consumer and builder. When signing a new home contract in South Australia, there is a cooling-off period of five clear business days. This can be longer if the builder has failed to supply a Form 1 notice outlining consumer rights and obligations, or fails to take out building indemnity insurance. PROGRESS PAYMENTS Builders are entitled to request payments when work is complete and ready for the next stage – these are known as “progress payments”. This builder must ask for these in writing (eg via invoice) and they must be outlined in the building contract. Consumers should never pay for work in advance and builders can be penalised for demanding money before completing work. VARIATIONS There can still be changes made to the plan once the contract is signed. These variations need to be agreed between the consumer and builder, and recorded as an addendum to the building contract so the builder can request payment for the work once completed. DEPOSITS There is a maximum amount a builder can take as a deposit: • $1,000 maximum for a contract valued between $12,000 up to $20,000 • 5% of the contract price for contracts $20,000 or more. Consumers should always be aware of paying any deposits in excess of 10% of the contract price. 10 THE BULLETIN September 2019
BUILDING & PROPERTY LAW BUILDING INDEMNITY INSURANCE If building work costs $12,000 or more and requires local council approval, building indemnity insurance is required. This protects consumers if the builder becomes bankrupt, disappears or dies and cannot complete the work or fix any defects under the five-year statutory warranty. WARRANTIES Builders often speak of a threemonth maintenance period and will ask consumers to wait three months to either bring defects to their attention or address the issues. This can work well as the builder doesn’t have to go back and forth as new problems are found, and the consumer won’t be constantly contacting the builder. Consumers don’t have to wait these 3 months however and can continue to raise issues after. There are certain warranties (known as “statutory warranties”) included under any building contract: • The building work must be carried out properly to meet all statutory requirements, accepted trade standards and agreed plans and specifications. • Materials supplied will be good and proper materials. • Unless the contract states a time frame that the work will be completed, the work will be done with reasonable diligence. • The building will be reasonably fit to live in. • The work and materials used will be fit for any purpose or result specified. If the building project doesn’t comply with these, consumers should discuss this with the builder. The owner has up to five years from the date of completion to lodge an action for a breach of these warranty conditions. Consumers can also claim for up to 10 years under the Development Act 1993 for any defective work that does not comply with the Building Code. MAKING A COMPLAINT ABOUT A BUILDER Despite best intentions, consumers and builders may find themselves in a dispute. The first step in resolving any disagreement is to speak directly to the builder, outlining all concerns in writing. If this fails to resolve the dispute, there are several options for disgruntled consumers. CONTACT CBS The Advice and Conciliation team within CBS provides free advice and information to help consumers reach an agreement with the trader. There are some circumstances where CBS is unable to provide further assistance: • if the matter relates to a builder or project outside of South Australia • if the matter is currently before Court. CBS encourages concerned consumers to contact them early so they can provide the right advice about their rights, who to contact and what to do next. COMPULSORY CONCILIATION CONFERENCES If the parties cannot agree on a solution, the Commissioner for Consumer Affairs can call for a conciliation conference. This will happen where CBS believes the trader has some responsibility to provide redress and is usually the final step before the consumer proceeds with civil legal action. Businesses must attend and can be fined up to $10,000 if they do not attend without a reasonable excuse. Before calling a conference, the Commissioner will consider: • the nature of the problem and what can be proven • the number of complaints against the business • how the business handles customer complaints • any legal issues. In these conferences, CBS will work to ensure the outcome is as fair as possible for both parties. CBS has no power to force the parties to enter into an agreement. If traders and consumers do sign an Instrument of Agreement, they must comply with all terms of the agreement – if they do not, this can be enforced in the Magistrates Court. COMPLIANCE AND ENFORCEMENT Even if the matter is resolved for the consumer, the issue may be referred for further investigation if a breach of legislation is identified. Sometimes the nature of the alleged conduct, the number of consumers affected or repeated incidents means further action needs to be taken. The Compliance and Enforcement team will investigate and may end up taking enforcement action. The enforcement action will depend on the level of harm and seriousness of the breach. The Commissioner has a range of options at his disposal when a breach is identified including: • formal warning letters • expiation notices • public warnings • disciplinary action • prosecution. PROSECUTION Over the past 12 months, 15 builders and tradespeople have been prosecuted in the Magistrates Court and ordered to pay significant fines and legal costs. In one case, an unlicensed builder who failed to complete work and caused additional damage to property was fined $175,000 and ordered to pay back more than $58,000 in compensation to clients. While CBS does take businesses to court, CBS cannot provide legal advice to consumers about pursuing their own civil case. MORE INFORMATION CBS encourages the public to report any concerns about unlicensed operators in the building and trades industry. Over the past few years, a “Dob in an unlicensed tradie” campaign has helped stamp out numerous unlicensed tradespeople. CBS also undertakes a proactive monitoring program to help keep the industry compliant. This includes inspectors visiting building sites, as well as monitoring advertisements in newspapers and online. The CBS website has a range of useful resources for consumers about building and working with tradespeople. The “Building, extending and renovating a home consumer guide” provides comprehensive details for those thinking about building or renovating. Consumers are also encouraged to check the Licensing Public Register on the CBS website: https://www.cbs.sa.gov.au/ find-a-licence-holder B September 2019 THE BULLETIN 11
Page 1 and 2: THE BULLETIN THE LAW SOCIETY OF SA
Page 3 and 4: This issue of The Law Society of So
Page 5 and 6: PRESIDENT’S MESSAGE Flexibility i
Page 7 and 8: GlobalX Search integrates with your
Page 9: EVENTS Glen Pearce (left) and Shery
Page 13 and 14: BUILDING & PROPERTY LAW The old Z W
Page 15 and 16: PROMOTION Managing the Financial Se
Page 17 and 18: BUILDING & PROPERTY LAW Just as wit
Page 19 and 20: BUILDING & PROPERTY LAW Regulations
Page 21 and 22: CRIMINAL LAW 3. Inviting a jury to
Page 23 and 24: FISHER BRENNAN CONSULTING Building
Page 25 and 26: YOUNG LAWYERS facebook.com/YLCSA re
Page 27 and 28: PROPERTY LAW acting together or hav
Page 29 and 30: PROPERTY LAW are likely to be like
Page 31 and 32: BUILDING & PROPERTY LAW There is no
Page 33 and 34: BUILDING & PROPERTY LAW Vadasz (Tra
Page 35 and 36: SOCIAL MEDIA jurors. 6 Such informa
Page 37 and 38: IN HONOUR Vale Damon Ind: A passion
Page 39 and 40: WELLBEING & SUPPORT Breaking the st
Page 41 and 42: FAMILY LAW improper to preclude dec
Page 43 and 44: RISK WATCH Details, details, detail
Page 45 and 46: GAZING IN THE GAZETTE 3 JUL 2019 -
Page 47: We manage one of SA’s largest soc

LSB September 2019_Web

You also want an ePaper? Increase the reach of your titles

Delete template?

Save as template?