Date: 18th July 2014
Important news for builders in Christchurch and around the country, from 1 January 2015 the Building Amendment Act 2013 will require building contractors to have written contracts, provide information on their relevant skills, experience and qualifications, and disclose their insurance and warranty cover for residential building work valued at over $30,000.
Here is an edited excerpt from an article by Buddle Findlay.
The new requirements strengthen the consumer protection measures currently contained in the Building Act 2004. The purpose of the consumer protection measures is to move away from the heavy reliance on building consent authorities for building quality and incentivise building professionals and tradespeople to take responsibility for the quality of their work and to stand behind it.
The amendments can be summarised as follows:
Much of the detail relating to the consumer protection measures is still to be outlined in regulations. The Ministry of Business, Innovation and Employment (MBIE) has yet to release draft regulations for public comment.
Before entering into a residential building contract Contractors will need to give the consumer the disclosure information and the checklist where the price of the building work is over $30,000 or where the consumer asks for the information, including:
Minimum requirements for a building contract
Where a building contract is above $30,000 it must be in writing, dated and contain certain provisions. These will be set out in regulations and may include:
The Act retains the existing warranties implied in building contracts which maintains the Building Act layer for consumer protection in addition to that contained in the Consumer Guarantees Act 1993 for services provided by contractors. As currently contained in the Building Act:
Remedies for breach of implied warranties
The amendment sets out remedies for a breach of the implied warranties, including:
Remedy of defect within one year of completion
There will be an automatic 12 month defect repair period when contractors will have to fix any defects in the building work of which the consumer advises the contractor “no questions asked”. This right is in addition to the implied warranties and the rights associated with a breach of those warranties.
Information to be provided on completion of a building contract
After the building work is completed the contractor will have to provide certain information (to be prescribed by regulations) to both the owner and the relevant consenting authority. The purpose of this obligation is to ensure that the consumer and future owners of the dwelling know who carried out the building work and can access information about the ongoing maintenance requirements of the building.
An on-seller is someone who:
It is an offence for an on-seller to settle a sale of a residential unit without a code compliance certificate being issued for the building work. It is possible to contract out of this requirement with the purchaser’s agreement, but the contracting out agreement must be in a particular form prescribed by the regulations.
Other recent law changes affecting business owners: