Home building contracts

AuthorJulian Bailey
Introduction 1468
Implied terms 1470
(i) Quality of materials 1470
(ii) Fitness for habitation 1470
English law concerning residential building work 1471
(i) Introduction 1471
(ii) e National House-Building Council scheme 1472
(iii) Unfair Terms in Consumer Contracts Regulations 1999 1474
(iv) Consumer Contracts (Information, Cancellation and Additional
Charges) Regulations 2013 1476
(v) Consumer Protection from Unfair Trading Regulations 2008 1477
(vi) Consumer Rights Act 2015 (UK) 1477
(vii) Defective Premises Act 1972 (UK) 1478
Australian law concerning residential building work 1482
New South Wales 1482
(i) Introduction 1482
(ii) Application 1482
(iii) Contractual requirements 1483
(iv) Implied warranties 1484
(v) Compulsory licence 1488
(vi) Home warranty insurance 1488
(vii) Dispute resolution 1491
Victoria 1496
(i) e Domestic Building Contracts Act 1496
(ii) Dispute resolution 1500
Queensland 1504
(i) Introduction 1504
(ii) Application 1505
(iii) Regulation of domestic building contracts 1506
(iv) Implied warranties 1507
(v) Compulsory licence 1508
(vi) Compulsory insurance 1508
(vii) Dispute resolution 1508
Western Australia 1510
(i) Introduction 1510
(ii) Application 1510
(iii) Contract requirements 1511
(iv) Compulsory insurance 1512
(v) Dispute resolution 1512
South Australia 1514
(i) Introduction 1514
(ii) Application 1514
(iii) Compulsory licence 1514
(iv) Contractual requirements 1515
(v) Implied warranties 1516
(vi) Compulsory insurance 1516
(vii) Demands for payment 1517
(viii) Right to terminate 1517
(ix) Dispute resolution 1521
Tasmania 1518
(i) Introduction 1518
(ii) Application 1518
(iii) Contracts 1519
(iv) Implied warranties 1519
(v) Further obligations of the building contractor 1520
(vi) Dispute resolution 1521
Australian Capital Territory 1521
(i) Introduction 1521
(ii) Application 1521
(iii) Implied warranties 1522
(iv) Residential building insurance 1523
Northern Territory 1523
(i) Introduction 1523
(ii) Application 1523
(iii) Required contractual terms 1524
(iv) Compulsory insurance 1524
(v) Dispute resolution 1525
e Australian Consumer Law 1525
(i) Introduction 1525
(ii) Application 1525
(iii) Unfair terms 1526
Hong Kong 1526
Singapore 1527
19.01 Contracts with natural persons for the performance of building work on their
actual or intended residential property are, in many ways, no dierent to building con-
tracts involving commercial parties and commercial purposes. Both types of contract
require that there be a suciency of agreement on terms, including importantly the
scope of works, and both types of contract will contain express or implied terms as to
the adequacy and timing of work to be performed by the contractor, and the price to be
paid for it. ere is no inherent reason, in logic, why a contract with a natural person for,
say, the construction of their house should be treated any dierently to a contract with
a large corporation for the construction of an oce building, a power station, or some
other business asset. At common law, freedom of contract applies to contracts between
builders and consumers just as it applies to contracts between sophisticated business
19.02 However, given that persons who arrange for residential building work to be
performed are often not able to take steps to protect adequately their interests as against
contractors and similar construction operatives, and such “ordinary consumers” may
therefore be regarded (to a greater or lesser extent) as “vulnerable”, the law (both statute
law and to a lesser extent the common law) intervenes by making available to such per-
sons legal rights and defences that are not available to “business” clients. ese rights and
defences, which concern what may be referred to compendiously as “home building con-
tracts”,2 require separate consideration. In Australia, home building contracts are singled
out for special treatment, and statutes apply across all State and Territory jurisdictions
to regulate the rights and obligations of owner and builder in a residential context under
such contracts.3 ere are no equivalent statutory provisions in England; however, home
building arrangements are subject to a certain amount of statutory interposition.4
19.03 e position in Hong Kong and Singapore is similar to that in England, namely
there is little by way of specic legislation5 or regulations to protect consumers who enter
into contracts for or which involve the performance of building or engineering work.
Nor furthermore, do the courts of those countries take an “interventionist” approach to
transactions involving consumers. Regulation is seen as a matter that is pre-eminently
for the legislature, not the courts.6
1 See Robinson v PE Jones (Contractors) Ltd [2012] QB 44 at 59 [67], per Jackson LJ.
2 ere is not a universally accepted expression for domestic premises, nor for contracts to perform work on such
premises. A person’s home may be described as a “dwelling house”, “home”, “residence”, or by several other expres-
sions. “Home building contract” is not an ideal expression to describe contracts for the performance of residential
building work, but it should suce for present purposes.
3 e housing industry itself has also attempted to make building contracts more “consumer friendly” by producing
contracts drafted in “plain English”, as to which see, eg, Leunig v Henley Arch Pty Ltd [2000] SASC 81 at [3], per
Martin J.
4 See, however, Kohl, “Towards a European Consumer Construction Law?” [2010] ICLR 211, where the view is
persuasively expressed that it would be benecial if there were to be a harmonisation of European construction laws
in the consumer paradigm. e imperative for European harmonisation may, however, be somewhat diminished
in the UK in light of its withdrawal from the EU. Nevertheless, it may be noted that, in other European coun-
tries, laws exist which confer rights upon owners, and subsequent owners, of residential property against persons
responsible for the design and construction of the property: see, eg, Milà, “Correspondent’s report – Spain – new
developments in professional liability for construction defects in Spain” [2019] ICLR 419.
5 at is, legislation or regulations which are targeted specically at consumers in the construction market, as
opposed to persons who enter into transactions generally of various descriptions.
6 See , eg, Management Corporation Strata Title Plan no. 2297 v Seasons Park Ltd [2005] 2 SLR 613 at [32].

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