• for Property Developers
• for Engineers
• for Contractors
• Building Defects and Strata

Recent Amendments to the Home Building Legislation

DAVID GLINATSIS

21 January 2013

The NSW Government has recently implemented some significant changes to the Home Building Act 1989 (NSW).

Recent Changes

Stage 1 commenced on 25 October 2011 and Stage 2 commenced on 1 February 2012.

Changes to the Home Building Act 1989 (HBA) include:

• Definition for the date of Completion to overcome the previous difficulties faced by Owners Corporations in establishing the date of Completion;
• Exclusion of the Civil Liability Act 2002 for residential building work;
• In respect of building contracts entered into after 1 February 2012, a claim to enforce statutory warranties must be commenced within 6 years for structural defects and 2 years for other defects from the date of completion of the works;
• Insurance Claims have an extension period of 6 months for any losses that become apparent in the last 6 months of the period of insurance;
• Beneficiaries must enforce statutory warranties after loss becomes apparent;
• Developer includes the owner of land who also owns or will own four or more units in the development even if not a party to the building contract.
• Insurance threshold increased to $20,000.

Application of Amendments

With limited exceptions, the amendments extend to:

• Residential building work commenced or completed before the amendments;
• A contract of insurance entered into before the amendments;
• A loss or liability that arose before the amendments.

Some important exceptions include the following:

• The amendments do not affect any Court or Tribunal decision made before the amendment.
• The 7 year statutory warranty is not reduced in respect of building contracts entered into before 1 February 2012. The new definition of completion, however, will apply.