Builders’ beware – new laws coming into force on 1 January 2015

New building laws coming into effect on 1 January 2015 will require all builders carrying out residential building work valued over $30,000 to have written contracts and disclose their skills, qualifications and licensing status, together with their dispute history. Failure to comply may result in fines. If you are a builder then this will significantly increase your compliance requirements.

The aim of this new legislation is to improve the quality of building work, with a focus on professionalism and open disclosure. Builders will need to ensure consumers have a clear expectation of what work is to be done, at what price and in what timeframe.

The contract between the builder and consumer must include specific clauses around the process for varying the contract, the payment process, dispute resolution and remedies. Consumers will also be supplied with a checklist which must include an explanation of the legal obligations of both the consumer and the builder, an outline of the risks associated with payment in advance for completion of the work, together with advice on engaging the builder and managing the project. These new initiatives aim to increase the protection of consumers and reduce disputes going forward.

Part of the reason for these "consumer protection" measures is to move away from what is seen as a current reliance on building consent authorities for building quality. Builders are being encouraged to take ownership and responsibility for the quality of the services they provide.

The detail relating to the above measures will be set out in regulations which have not yet been finalised. If you would like us to make a submission on your behalf then please contact us.

We will provide a further update once the regulations are passed.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.