NEED TO KNOW
The Queensland Government has recently released the Queensland Building and Construction Commission and Other Legislation Amendment Bill 2014 (the Bill) which will repeal the Domestic Building Contracts Act 2000 (Qld) (DBC Act).
Domestic building contracts are construction contracts governing “domestic building work”, which includes:1
- the erection and construction of detached dwellings;
- renovation, alteration, extension, improvement or repair of a home; and
- removal or resiting work for a detached dwelling.
Domestic building contracts do not include:
- contracts between building contractors and subcontractors or;
- contracts for the construction of 2 or more detached dwellings.2
This position will not change under the proposed new legislation.
The Bill will consolidate the statutory regulation of domestic building contracts by inserting a new Schedule 1B (Domestic building contracts) into the Queensland Building and Construction Commission Act 1991 (Qld) (QBCC Act), the principal piece of legislation governing building contracts in Queensland.3
The Government’s stated intent is to enhance protection for consumers while also reducing excessive red tape associated with domestic building contracts.
Click here to access a full copy of the Bill and Explanatory Notes.
THE DRAFT BILL
The Bill introduces two levels of domestic building contracts based on the value of the work being performed. Contracts will be considered either a ‘level 1 regulated contract’ or a ‘level 2 regulated contract’.
Level 1 regulated contracts are contracts below a certain value and level 2 regulated contracts are contracts with a value above that threshold value. The draft regulation containing the prescribed value threshold has not yet been published.
In practical terms, the two tier system will see level 1 contracts subject to less regulation than level 2 contracts.
Different legislative requirements will apply for level 1 and level 2 regulated contracts. The key differences between the two types of contracts are:
- provisions which must be included in the relevant domestic building contract;
- the statutory cooling off period ;
- deposits; and
- the documents a building contractor must provide to a building owner.
A list of the key changes under the draft Bill are summarised in Diagram 1.
Click here to view Diagram 1.
The Bill has been referred to the Transport, Housing and Local Government Committee for review and is due to be tabled in parliament on 8 October 2014.
Subject to further amendments to the draft Bill, the legislation is likely to come into force in late 2014/early 2015.