The Home Building Act is widely recognised as tortuous and impenetrable. Its annual rounds of heavy amendments have set a high level of user unfriendliness. To the uninitiated, large swathes of the Act seem to have little to do with the regulation of residential building work.
The Department of Fair Trading acknowledges the complexity and problems with the act and now appears to be moving to address them. The department has resolved to undertake a re-write of the act that not only involves a restructure, but a review of much of the regulation of residential building work in New South Wales.
In a recent address to the Northern Suburbs Division of the Master Builders Association, Steve Griffin, the General Manager of the department explained that the starting point is on a blank sheet and nothing in the Act is immune from review. Work on the re‑write is already under way with the department currently reviewing interstate legislation.
In August and September, the department will be consulting with stakeholders such as the Master Builders Association, the Housing Industry Association, warranty insurers, consumer advocates and other stakeholders. In October and November it is proposed that the department produce a paper "floating" what it sees to be the main issues and the areas for review. In about February 2008 an exposure draft will be circulated for further consultation with stakeholders. It is proposed that in May through to June of 2008 the draft be reviewed in light of the further submissions and a further document be refloated in July to August of 2008 with a view to a bill being introduced into the spring 2008 session of New South Wales Parliament.
Steve Griffin identified a number of areas he expected would be the subject of change. These include:
clarifying the responsibilities of subcontractors in the performance of residential building work
conforming the duration of builders warranties and home warranty insurance indemnity
reducing the duration of the statutory warranties insofar as they relate to non structural works
addressing the perceived abuse of the owner builder licence arrangements
noting of owner builder work on the title to the land
clarifying who needs to hold a builders licence, with particular attention to specialist within the trades
reforming the dispute resolution regime with the possibility of assessors having the power to require the home owner to pay money (whereas assessors are currently only entitled to order the builder to rectify defective or complete/incomplete works)
changing the scope of the involvement of the Consumer, Trader and Tenancy Tribunal, perhaps with building disputes for more than small amounts being dealt with by a specialist building tribunal.
It is also possible that the Environmental Planning and Assessment Act will be amended to provide, in respect of owner builder work, that an owner builder's permit be a prerequisite to the issue of the construction certificate. Either way it seems that the knives are being sharpened in preparation for an owner-builder slaughter.
Steve Griffin is clear that there are many other issues that will be receiving the department's close attention in the re-writing process.
Industry associations such as the Master Builders Association are currently formulating submissions for the re-write. The list of grievances and matters that require review will be a long one. The complexity of the residential building industry and the Home Building Act suggest that the timetable may be over ambitious, but most will be happy that there is at least now some momentum. If only we could see similar activity and interest on the security of payment front!
The current good level of consultation communication by the department and its general manager are to be applauded and present a rare opportunity for the stakeholders to participate in a meaningful manner. It may be overstating the case to say this is a once in a lifetime opportunity but one hopes that this process will be permitted to deliver to its potential, rather than being stifled by short term political imperatives.
Everyone who undertakes or is involved with residential building work will have issues and grievances about the act and, no doubt, suggestions as to how it can be improved. Now is the time to take your suggestions to your industry association so as they can be included in submissions and perhaps be incorporated in the re-written act.
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