A building dispute arises when a party to a construction contracts fails, or is perceived to have failed, to fulfill their contractual obligations to a contracting party. When the parties cannot resolve it by themselves, experts in construction law can guide them to lodge complaints in the Office of Fair Trading and the NCAT.
So many factors can contribute to why building disputes happen and worsen quickly. In our construction solicitor’s experience, the most common causes of building disputes are non-payment, under payment, and late payment for works done; disagreements about the scope of work; poor builder workmanship, defective work that lead to structural failure; construction delays or abandonment of works; and miscommunication between builder, contractor, and homeowner.
Disputes can escalate very quickly and can cost clients- both builders and homeowners- so much time and money. Contract Specialist’s construction lawyer can advice you on how to deal this legal situation, starting from Fair Trading to proceedings at the NSW Civil Administrative Tribunal, also known as the NCAT.
The NSW Fair Trading safeguards the rights of all consumers and advises business and traders on fair and ethical practice.
NSW Fair Trading can assist for the first instance of a building dispute. If a consumer (homeowner) and a trader (builder) cannot resolve a dispute between themselves, they can contact Fair Trading to assist with the dispute resolution and mediate an outcome suitable for all parties concerned in the construction project.
The building work should be within the relevant statutory warranty period. As per the Home Building Act, this would be six years for structural defects and two years for non-structural defects from the date of the completion of home building work.
This home building dispute resolution service by NSW Fair Trading started in 2003. To move forward, a formal request Fair Trading to assist in the dispute resolution must be made by either the consumer (homeowner) or the trader (builder), but both parties need to agree to the attempt at the resolution.
damage caused to other structures as a result of home building work being done
(such as electrical wiring, plumbing, gasfitting or airconditioning)
This early intervention dispute resolution process proves to be highly successful. They utilise trade-qualified and very experiencing building inspectors to resolve home building disputes. According to Fair Trading, they have more than 20 building inspectors located across NSW including Newcastle, Lismore, Coffs Harbour, Wollongong, Wagga and Dubbo.
The inspector assigned to the case will set a schedule to meet with both the consumer and trader on the construction project site, investigate the complaint and asses the alleged defective or incomplete work.
If the inspector finds out that the work is the responsibility of the builder, he will issue a Rectification Order to tell the builder to correct or complete the defective or incomplete work by a set due date.
The builder at fault should immediately do the work prescribed because it is a breach of the Home Building Act 1989 for a trader to fail to comply with a Rectification Order. He will be in a lot more trouble.
It has to be noted though that for this process to be valid, the complaint must be lodged with Fair Trading and finalised by the Dispute Resolution and Inspection Branch before the expiry of the statutory warranty periods.
More info about the Fair Trading building dispute resolution outcome
In some instances, even with the intervention and assistance of NSW Fair Trading, parties still cannot reach an agreement and the inspector assigned to their case is not satisfied about the ‘balance probabilities’ that the alleged defective or incomplete work is the responsibility of the trader, a consumer can lodge an application with the NSW Civil and Administrative Tribunal (NCAT) to have the complaint heard and determined.
The NSW Civil and Administrative Tribunal (NCAT) is the one-stop-shop for specialist tribunal services in New South Wales. The NCAT deals with a broad and diverse range of matters and that includes building and construction works.
The Consumer and Commercial Division resolves a wide range of everyday disputes such as tenancy and other residential property issues, and disputes about the supply of goods and services.
NCAT can hear and determine applications lodged by homeowners and traders about residential building work up to the value of $500,000 under the Home Building Acts 1989 which relates to the carrying out of residential building work.
‘Home building’ refers to any residential building work done by a builder, including construction of a new home, adding extensions to already existing home, renovation of a kitchen or a bathroom.
The Home Building Act 1989 (NSW) governs residential building work in New South Wales.
The Act outlines the minimum statutory rights of owners, builders, and contractors. This includes warranties, payments, deposit, insurance, and other matters relating to residential construction work.
In terms of dispute resolution, the Home Building Act states that the NSW Fair Trading will attempt to negotiate a suitable outcome between the homeowner and the builder. Should the negotiation be unsuccessful, the homeowner given information about his further options including dispute resolution by the Home Building Service or the involvement of the NSW Civil and Administrative Tribunal (NCAT).
Amendments have been made to the Home Building Act and some were put into effect in 2014 to ensure that the home building laws reflect current practices and reduce any unnecessary red tape for the construction industry. The changes aimed to provide more appropriate protection for builders and required owners to act promptly when concerns around defects arise.
Construction is indeed such a huge investment, and building disputes can have a big financial impact on both a homeowner and a builder. Going through the process of a building dispute and tribunal hearings can be stressful and intimidating. But you can get the help of experts in construction law who can explain everything to you in a way you would understand.
As specialist building and construction lawyers, Contracts Specialist will help you enforce and defend your rights– whether you are the homeowner, a builder, or subcontractor.
We will go over the scope of work stated on your building contracts and investigate whether a breach has been made. we will explore all your legal and construction dispute resolution options, we will guide you through litigation.
John Dela Cruz is an expert in construction and building law and is very familiar with the New South Wales Civil and Administrative Tribunal (NCAT). He has extensive experience being a lawyer for residential disputes, so you can be assured that you will be in good hands.