In response to years of consumer complaints, the state government is implementing major changes in relation to domestic building contracts and disputes in Victoria. Practitioners need to be aware of the new procedures and requirements.
On 19 April 2016, Royal Assent was given to the Building Legislation Amendment (Consumer Protection) Act 2016 (Vic) (the Amendment Act). This new Act is being rolled out in stages over 12 months. It will make substantial changes in an attempt to reduce domestic building disputes and improve the protection of consumers of building works throughout Victoria.
The first set of changes came into effect on 4 July 2016. They include:
- creating new offences for working without a building permit (revised s 16 of the Building Act 1993 (Vic) (the BA));
- extending the VBA’s inspection powers to owner-built sites (revised ss 227B and 227C of the BA);
- redefining the circumstances where a building surveyor may not act (revised s 79 of the BA);
- updating the threshold amount for a certificate of consent for owner-builders (revised s 24A(3) of the BA);
- providing for a checklist that relevant building surveyors must use when lodging building permits to councils (new ss 30A and 30B of the BA); and
- updating powers to issue directions to fix building work (new ss 37, 37A–K, 118A and 138A of the BA).
Further new requirements apply from 1 September 2016, as follows:
- The Building Practitioner’s Board has been abolished from 1 September, except for finalising referred matters – Part 3 of the Amendment Act. Its functions, powers and responsibilities have been transferred to the VBA, including:
- registering building practitioners,
- supervising and monitoring building practitioners’ conduct and capacity to practise, including disciplinary proceedings and action, and
- issuing certificates of consent to owner-builders.
- The VBA will now make all decisions in relation to disciplinary action, and have put in place new procedures including:
- a new show cause notice process where disciplinary action is proposed to be taken,
- a new right to internal review of a VBA decision (for example, to refuse an application for registration or to take disciplinary action) by an independent internal review unit within the VBA, and
- appeal rights to VCAT.
- In respect of all major domestic building contracts entered into from that date, a builder must give an owner a copy of the new Domestic Building Consumer Guide before they sign a major domestic building contract. The Domestic Building Consumer Guide is the contract information statement required by s 29A of the Domestic Building Contracts Act 1995 (Vic) (the DBCA). A copy is available at the Consumer Affairs Victoria website.
- A new version of the Approved Domestic Building Contracts Checklist required by s 31(1)(r) of the DBCA now applies. A copy is available at the Consumer Affairs Victoria website.
- A builder who enters into a major domestic building contract, or a person who acts as a domestic builder for building work, may no longer appoint a building surveyor on an owner’s behalf. Similarly, a building surveyor cannot accept an appointment from a builder on an owner’s behalf. A builder may recommend a private building surveyor, but an owner is free to appoint a private building surveyor or the municipal building surveyor of their choice (new s 78(1A) and (1B) of the BA).
More changes will come into effect in early 2017, especially:
- A new dispute conciliation framework will commence (Part 2 of the Amendment Act) as follows:
- This framework will include a new service named Domestic Building Dispute Resolution Victoria (DBDRV) which will replace Building Advice and Conciliation Victoria.
- DBDRV will consist of a chief dispute resolution officer, conciliation officers and technical assessors.
- DBDRV will be administratively linked to Consumer Affairs Victoria.
- It will be a free and independent service available to both builders and home owners.
- It will have powers to make binding orders on all parties to resolve disputes.
- Appeal rights will lie from these orders to VCAT, and VCAT will have new costs powers.
- All domestic building work disputes (not already commenced in VCAT or a court) will be required to be conciliated at DBDRV before a party may make any application to VCAT or a court (save for actions for injunctive relief).
- Further, although not mentioned in the legislation, the government is seeking to establish a Domestic Building Legal Advocacy Service (DBLAS) following the insertion of s 124(3)(ca) in the DBCA. According to the CAV website, DBLAS will be a limited and selective service providing no-cost or low-cost legal advice and advocacy services for eligible Victorian domestic building consumers in special need of assistance.
More information is available at the websites of Consumer Affairs Victoria and Victorian Building Authority or by contacting the author.