CHANGES TO THE BUILDING ACT 2004 - FOUR KEY THINGS YOU
NEED TO KNOW.
The changes to the Building Act 2004 ("the Act"), which took
effect on 1 January 2015 attempt to strengthen consumer protection
around residential building work. As a result, building
contractors involved in the residential sector will need to update
their contract documentation.
Sharp Tudhope Lawyers Partner Richard Kettelwell summarises
below four need-to-know things in relation to these changes.
(1) Who is Affected?
The changes apply to building contractors undertaking building
work (the construction, alteration, demolition or removal of a
building). Building contractors includes not only builders but also
electricians, plumbers and other building professionals where they
contract directly with the residential dwelling owner. The
changes do not affect subcontract agreements between a building
contractor and a building subcontractor.
(2) What Work Do the Changes Apply to?
The changes are primarily directed at work valued at $30,000 or
greater on residential household units.
Building work covered includes the construction, alteration,
demolition or removal of a building for a client in relation to a
household unit. The changes cover not only traditional
"building" work but also plumbing, electrical, roofing etc in
connection with a building.
(3) What Do You Need to Do?
Building contractors affected by the changes need to amend their
contract documentation to include:
- Disclosure Information:The disclosure information includes
details of the building contractor's skills and qualifications
together with insurances and warranties applicable to the
- Check List: The checklist is prescribed by Regulation and is
intended to aid consumers understanding of the building
- Minimum Requirements: residential building contracts over
$30,000 must be in writing, satisfactorily identify each party,
provide the address where the building work is to take pace,
provide a description of the building work such as the materials
and products to be used, who will be undertaking, supervising and
obtaining the building consents for the work, start and completion
(4) What Else Should You be Aware Of?
Other factors to be aware of include:
- Right to Remedy Defect Within One Year of Completion:
There is an automatic 12 month defect repair period where
contractors are obliged to fix any defects in the building work of
which the consumer advises the contractor.
- Information Provided on Completion of Residential
BuildingContract: building professionals must provide to the owner
of the dwelling details of any guarantee or insurance obtained by
the contractor for the building work and maintenance requirements
for any products incorporated in the building.
- Penalising Building Contractors:Building contractors may be
fined and/or face civil action for damages for failing to provide
the pre-contract information, meeting the minimum requirements of
the building contract or failing to provide the necessary
information on completion of the contract.
If you have any queries about your duties as a building
contractor or if you wish to have your residential building
contract amended to comply with the new legislation contact Richard
Richard specialises in building and construction matters and is
also chairperson of the Bay of Plenty Branch of Civil Contractors
* Please note that this blog entry /article is a broad
summary only, is not legal advice and should not be acted or relied
upon without seeking legal advice.