Unfortunately, many people find themselves in a dispute with their builder. These types of disagreements inevitably become emotional and can escalate quickly. If they do, they can be costly. This article outlines how consumers can resolve their disputes with their builder as cost efficiently as practicable.

Australian Consumer Law

As the providers of a service to consumers, builders are subject to the Australian Consumer Law (Cth) (ACL). As such, they must honour all the applicable consumer guarantees. Regarding services, this means that service providers must use appropriate care and skill and have all necessary technical knowledge. They must take all measures appropriate to prevent damage or loss, and their service must either be fit for its intended purpose or the purpose agreed between the builder and the consumer. Finally, service providers should provide their service in a reasonable time in the absence of a particular contractual date. If service providers fail to meet all these obligations, they should give a consumer the appropriate statutory remedy, whether it be a refund or they carry out their contractual duties.

Depending on the nature of your dispute, your builder may owe you a statutory remedy and be willing to provide it to you. It is a good idea to speak calmly with your builder. Explain to them your concerns and why you feel such a remedy is appropriate. Be prepared to listen to what they have to say in response.

Discuss the Issue with Your Builder

In any event, the first step for any consumer involved in a dispute with their builder must be to discuss the issue with them. The discussion should be frank but fair. Both parties need to listen to the other. If they do, they may perceive a way of moving forward agreeable to both. Talking through the issues could thus resolve the dispute at minimal cost. Be sure to take accurate notes after any discussions with your builder about when it occurred and who said what. This information could be relevant at a later stage.

Check the Building Contract

All consumers usually sign a contract with their builder. The agreement outlines the services that the builder will provide, the price, any terms and conditions that a builder attaches to their services as well as the consumer’s rights and obligations per all applicable legislation. These agreements usually include a clause that requires the parties first to undertake alternative dispute resolution in the event of a dispute. A party cannot instigate any other kind of action unless they have complied with this clause. If a clause contains such a provision, both parties should follow it promptly to resolve their dispute as soon as possible.

Alternative Dispute Resolution

In the unlikely event that the building contract has no such provision, the parties can nonetheless choose to partake in this kind of process. Alternative dispute resolution is effective and less expensive than court action. It can also preserve a better relationship between the parties. However, all parties must be willing to listen to each other and negotiate.

There are different types of alternative dispute resolution. For example, mediation as opposed to conciliation. The parties to a dispute need a process suited to their needs. Also, many state or territory agencies offer reasonably priced dispute resolution services to help keep costs as low as possible for individuals and business.

Recourse to a Tribunal

If alternative dispute resolution is unsuccessful, a party can make an application to their appropriate state or territory administrative tribunal. In NSW, the relevant tribunal is the NSW Civil and Administrative Tribunal (Consumer and Commercial Division). If the dispute applies to home building, a party must first refer it to NSW Fair Trading before NCAT can accept their application. NSW Fair Trading has a Home Building Dispute Resolution Service which tries to mediate a suitable outcome for all the parties to a conflict. Qualified building inspectors are integral to the scheme, and it has a considerable success rate.

NCAT can hear disputes about residential building work performed by building contractors and tradespeople up to the value of $500,000. Depending on the amount of the claim, a hearing is set down within 6 to 8 weeks. Be aware that the Tribunal is obliged under the Home Building Act 1989 (NSW) to require a responsible party to perform any necessary rectification work even if an applicant does not request this.

At the hearing, the Tribunal will listen to both parties, evaluate the evidence and make binding and legally enforceable orders. Applicants can represent themselves at the hearing and are likely to pay only their preparation costs.

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LegalVision has helped many businesses and individuals with their legal needs. If you have a question about a building dispute, contact us today on 1300 544 755 or fill in the form below.

Carole Hemingway

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