The New South Wales Civil and Administrative Tribunal (NCAT) hears disputes initiated by homeowners, tradespeople and insurers involving residential building work costing $500,000 or less. Overall, the purpose of NCAT is to be a faster and cheaper alternative to traditional court. However, preparing for an NCAT dispute still requires a great deal of forethought and preparation. This article sets out the steps you can take to best prepare for a building dispute in NCAT.
What is Residential Build Work?
Residential building work encompasses all work carried out by people who construct, alter or repair a residential building. For example, it covers works such as:
- bathroom or kitchen renovations;
- home extensions; and
- the construction of a new home.
You can advance a claim if work on a residential building is incomplete, defective or you have not been paid for your work on a building.
NCAT Application Checklist
If you are looking to make an application to NCAT, there are several formalities and processes you must first complete. Additionally, throughout your NCAT application, you should be aware of your ongoing responsibility to prepare your witnesses and genuinely engage in alternative dispute resolution, such as mediation.
Overall, there are six key steps you should first consider.
1. Ensure You First Approached NSW Fair Trading
The first step in any home building dispute is to refer the matter to NSW Fair Trading. NCAT will not accept an application before it has been referred to NSW Fair Trading. Home building complaints can be lodged online.
You can only apply to NCAT if NSW Fair Trading was unable to resolve your dispute. You must provide a copy of your correspondence, along with any orders made by Fair Trading, in your application.
2. Comply With Time Limits
Certain time limits apply to home building applications in NCAT.
For claims relating to breaches of statutory warranties (automatic rights which arise when someone builds you a house), the application must be lodged:
- within six years for major defects; or
- within two years in every other case.
For claims relating to the supply of building goods or services, the application must be lodged:
- within three years of the last supply of goods or services; or
- if not supplied, within three years from when the goods or services should have been supplied.
For all other claims, you must lodge the claim within three years from the date of the contract.
3. Seek Preliminary Legal Advice
Even if you do not desire legal representation, you should seek preliminary legal advice to identify the key legal issues of your dispute.
Further, you should seek legal advice for other potential issues which may arise. For example, you may need to:
- attempt to minimise any losses you are incurring;
- take certain formal steps to try and resolve the dispute; or
- terminate the contract in accordance with the terms of your contract.
While NCAT generally hears from self-represented individuals, NCAT can permit parties—after receiving an application—to find legal representation. NCAT will usually allow you to use legal representation if your home building claim amounts to over $30,000.
4. Prepare Your Evidence
If your claim relates to incomplete or defective building works or breaches of statutory warranties, you need to produce evidence.
While traditional rules of evidence do not apply to NCAT, evidence such as someone’s opinion will not be accepted unless it comes from an expert. The expert should have specialised knowledge based on their training, study or experience.
Therefore, you will need to engage a qualified building consultant to carry out an inspection to produce a report and Scott Schedule which meets NCAT requirements.
What is a Scott Schedule?
A Scott Schedule sets out the various defective and incomplete works and provides a cost estimate for resolving these. Your expert witness may provided cost estimates based upon industry standards. However, you should obtain multiple quotes from qualified builders or contractors to support the estimates in the Scott Schedule.
Although NCAT is generally a cheaper jurisdiction than court, building disputes can end up being quite costly. Expert reports can be very expensive, typically ranging from $2,000 to $20,000, although a large claim may cost even more. Typically, you can recover these costs if you are successful.
However, you should still research your options before engaging an expert to produce your report, such as by checking their qualifications. Your expert may also be called as a witness for any final hearing for questioning about their report. However, if your expert lacks the correct qualifications, your Scott Schedule may be rejected by NCAT and your expenses would not be reimbursed.
5. Submit Your Application
You can lodge your NCAT application online. However, you must post or deliver any attachments directly to NCAT within five business days of lodging your application.
You must also pay the application lodging fee, which is updated on NCAT’s website on 1 July each year. Overall, the final fee you must pay will be impacted by:
- how expensive the building work in your dispute is;
- whether you are an individual or a corporation; and
- whether you are an eligible pensioner.
6. Engage in Alternate Dispute Resolution
You should be prepared to engage with various types of alternative dispute resolution. After lodging your application, your matter will likely be listed for conciliation and hearing within eight weeks. At this first hearing, an NCAT member will request that the parties enter a private room and attempt to resolve their dispute. If no agreement is reached, then the NCAT member will create a timetable for the proceedings. The NCAT member will set out details such as:
- when each party must produce their evidence; and
- the date of the final hearing.
While the first conciliation may not assist the dispute, you should still prepare to engage in negotiations outside NCAT. You or the other party can settle over the phone or through writing.
No matter how you engage in settlement negotiations, you should make sure you state these negotiations are on a ‘without prejudice’ basis. This is a legal tool which protects genuine settlement communications between the parties to a proceeding from being used as evidence. While the other side may not accept an offer you make, if you made a reasonable offer, then this may prove useful at the end of the proceedings if either party seeks an order for costs.
NCAT allows home building disputes to be resolved quickly and at a lower cost than traditional courts. Before proceeding with an application, you should first apply through NSW Fair Trading. If you are unsuccessful here—and your claim has not expired—then you may proceed to file an application with NCAT.
Following this, you should seek legal advice about the issues in your case. When you are ready, you should prepare your evidence, including engaging an expert to produce a report and Scott Schedule (if required). The timetables for NCAT matters can be quite short, so you should prepare in advance as much as possible. Lastly, once your application has been submitted, remain open to negotiating settlement with the other party.
If you require assistance in preparing for a building dispute or submitting an NCAT application, get in touch with LegalVision’s litigation lawyers today on 1300 544 755 or fill out the form on this page.
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