LawTalk Blog

Warranty periods under the Building Work Contractors Act versus the Development Act

building works warranties

The Building Work Contractors Act

The Building Work Contractors Act 1995(SA) ("BWCA") regulates building work contractors and the supervision of building work. Under the BWCA there are certain statutory warranties that apply to domestic building work contracts entered into post 22 January 1987.

Under the BWCA the builder must ensure (amongst other things) that building work is:

  1. Performed in a proper manner to accepted trade standards and in accordance with plans and specifications;
  2. Materials used are good and proper;
  3. Building work performed with reasonable diligence;
  4. Fit for human habitation.

If you have purchased a house and building work was done prior to you purchasing the house you still keep the statutory warranties so that you can bring a claim under the BWCA for faulty building work even if the building work was done prior to you buying the house

Proceedings for breach of a statutory warranty must be commenced within five years after completion of the building work to which the proceedings relate and this period may not be extended. Proceedings are commenced in the Magistrates Court or the District Court depending on the amount that is to be claimed to rectify the works.

In proceedings for breach of a statutory warranty, it is a defence for the defendant to prove that the deficiencies of which the plaintiff complains arose from instructions insisted on by the building owner contrary to the advice in writing of the defendant.

The Development Act

The Development Act 1993 (SA) ("DA")regulates planning and development in the State and in particular the construction, demolition or removal of buildings. Developments must be approved under the Act and the Act also regulates the performance, standard and form of building work to ensure it meets the requirements of the Building Code of Australia which is incorporated as Building Rules under the Act.

The Building Code of Australia is the national technical document which sets the standards of building work in Australia. There are also South Australian state variations to the Code including Minister's Specifications.

It is an offence under the DA to:

  1.  Breach a Building Code;
  2.  Breach an associated environmental protection requirement as prescribed by the   Environmental Protection Act;
  3.  Breach an associated equity code as prescribed by the Disability Discrimination Act;
  4.  Fail to comply with an enforcement notice issued by an external body.

A person with a dispute subject of the Act may apply to the Environment, Resources and Development (ERD) Court which is a specialist court dealing with disputes and enforcement of laws relating to the development and management of land, the natural and built environment and natural resources.

The Court has the power to order that a building (or any part of a building) be altered, reinstated or rectified in a manner specified by the Court or that a party to the dispute remove or demolish a building and make a determination or declaration, or grant any other remedy or relief as the Court thinks fit, if there is a failure to comply with the Building Rules.

It is a defence under the Act to prove that the failure to comply was only of a minor nature and had no adverse effect on the structural soundness or safety of the building in respect of which the relevant building work was performed.

Commencing an action for damages for economic loss or rectification costs resulting from defective building work under the DA can be commenced more than 10 years after completion of the building work, thus giving a longer period to commence actions than the BWCA.

Compare and Decide

When deciding whether to commence a claim under the BWCA or the DA there is a number of considerations to take into account. For example you should consider who you will be taking legal action against, the court you will commence proceedings in and the remedies available to you and when the breach of statutory duties/the building code occurred.

Under the BWCA, the owner of the property has the ability to commence the action, in the Magistrates Court, against the builder who has performed the poor work.. The BWCA allows for rectification of the work by the builder or compensation to be paid if the builder is unable to rectify it. The BWCA also allows action to be taken for poor workmanship, poor materials amongst others and gives a wider scope to initiating claims than the DA. The time limit for the commencement of actions is five years after completion of the work.

Under the DA the owner of the property or the council can take action against the builder in the Environment Resources and Development Court. The DA allows for rectification of the work by the builder or compensation to the owner/council but only relates to breaches of the Building Code that cause the building to be dangerous or non-compliant. Therefore the DA is narrower in scope. The time limit for commencement of actions is 10 years after the completion of the work.

Please note, this Blog is posted in Adelaide, South Australia by Andersons Solicitors. It relates to Australian Federal legislation. Andersons Solicitors is a medium sized law firm servicing metropolitan Adelaide and regional South Australia across all areas of law for individuals and businesses.

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