The Home Building Act

In our line of work we can, at times, get too focused on our jobs and shut out the world. On 28 May last year, certain amendments were made to the Home Building Act (1989) that could have a bearing on contractors who carry our restumping and renovation work. We have made a list of certain important laws that contractors should keep in mind.

The Amendment to “Structural Defect”

The new law replaces the definition of “structural defect” in section 18E of the HBA with the concept of “major defect”.

A “major defect” is defined in new section 18E(4) as:

“a defect in a major element of a building that is attributable to defective design, defective or faulty workmanship, defective materials, or a failure to comply with the structural performance requirements of the National Construction Code (or any combination of these), and that causes, or is likely to cause:
- the inability to inhabit or use the building (or part of the building) for its intended purposes, or
- the destruction of the building or any part of the building, or
- a threat of collapse of the building or any part of the building, or
- a defect of a kind that is prescribed in the regulations as a major defect.”

A “major element” is also defined in section 18E(4) as:

An internal or external load-bearing component of a building that is essential to the stability of the building, or any part of it (e.g. foundations, floors, walls and beams)
A fire safety system
Waterproofing
Any other element prescribed by the regulations as a major element of a building.

The limitation period for commencing proceedings for an alleged breach of a statutory warranty is 6 years for a “major defect” and remains 2 years for defects that are not major defects.

Defence of reasonable reliance on instructions from a relevant professional

Defences available to a defendant under section 18F are broadened. Under new section 18F(1)(b), it is a defence to a claim for breach of a statutory warranty if the defendant can prove the deficiencies complained of arise from its reasonable reliance on written instructions from a relevant professional acting for the person for whom the work was contracted and who is independent of the defendant.

For Contractors and Subcontractors

Tradespeople who carry out foundation work, renovations, and repairs, need to carry out their tasks “with due care and skill.” Other changes include:

That residential building work done under a contract must be insured in the name of the person who contracted to do the work
That a contract for insurance in relation to residential building work extends to cover any residential building work done in rectifying the original work
That a claim for non-completion of work as well as defective work can be made as a delayed claim to allow a beneficiary to continue to pursue a contractor for a breach of the statutory warranties beyond 12 months after the work has finished

If you are confused about any of these changes please don’t hesitate to contact the team at Melbourne Restumping for more information.

The Home Building Act