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Posted 01 June 2015
Category: Building Defects
In a Nutshell
The anticipated 1 December 2014 commencement date for the Home Building Amendment Act 2014 has been delayed allowing owners corporations some breathing space.
We have confirmed with Fair Trading NSW that the Home Building Amendment Act 2014 and the Home Building Regulation 2014 is to commence in two stages in 2015.
The first stage, expected to commence in mid-January 2015 is anticipated to contain all amendments introduced by the Home Building Amendment Act 2014 and the Home Building Regulation 2014 other than amendments to residential building contracts required by that amending legislation.
With the Christmas and New Year period this is effectively only a five week extension.
The second stage, expected to commence either in the first or second quarter of 2015, will contain those reforms which mandate the re-drafting of contracts to comply with the amending legislation.
While there has been some relaxation of the commencement date of the amendments, to preserve existing valuable rights owners corporations should consider the following urgent steps before the amendments commence:
Mid-January 2015 Commencement – Statutory Warranty Reforms
The amendments to the Home Building Act 1989 that alter the statutory warranties from a “structural defect” to a warranty for a “major defect” in a “major element”, which in lay terms is basically a severe defect, are expected to commence in the first stage of reforms due to commence in mid-January 2015. Those amendments will have retrospective effect as we’ve previously commented.
In addition, other amendments that are likely to commence in mid-January 2015 for building contracts entered into after that date are as follows:
Later Commencement – Remaining Reforms
The second round of reforms will likely include changes to the form and content of contracts required by the amending legislation and the change to make maximum deposits of 10% uniform across all residential building contracts.
The second round of reforms are likely to commence in the first or second quarter of 2015 and the date of the commencement of those reforms has not been announced.
It will, however, be necessary to review work orders to ensure that subcontractors are identified.
***The information contained in this article is general information only and not legal advice. The currency, accuracy and completeness of this article (and its contents) should be checked by obtaining independent legal advice before you take any action or otherwise rely upon its contents in any way.