Domestic Building Contracts and Tribunal (General) Regulations 1996

i Domestic Building Contracts and Tribunal (General) Regulations 1996 S.R. No. 32/1996 TABLE OF PROVISIONS Regulation Page 1. Objectives 1 2. Authorising provision 1 3. Definitions 2 4. Building work to which Act does not apply 2 5. Type of cost plus contract allowed 2 6. Progress payments 3 __________________ SCHEDULE 4 FORM 1—Warning to owner—change of legal rights 4 FORM 2—Progress payments 6 -- 1 of 7 -- 1 STATUTORY RULES 1996 S.R. No. 32/1996 Domestic Building Contracts and Tribunal Act 1995 Domestic Building Contracts and Tribunal (General) Regulations 1996 The Governor in Council makes the following Regulations: Dated: 30 April 1996 Responsible Minister: JAN WADE Minister for Fair Trading A. WILTSHIRE Clerk of the Executive Council 1. Objectives The objectives of these Regulations are— (a) to prescribe certain work as building work to which the Act does not apply; (b) to allow certain contracts to be cost plus contracts for the purposes of section 13 of the Act; and (c) to prescribe, with regard to progress payments, the manner in which parties to a contract may agree that sections 40(2) and (3) of the Act do not apply. 2. Authorising provision These Regulations are made under section 135 of the Act. -- 2 of 7 -- S.R. No. 32/1996 Domestic Building Contracts and Tribunal (General) Regulations 1996 2 3. Definitions In these Regulations, "the Act" means the Domestic Building Contracts and Tribunal Act 1995. 4. Building work to which Act does not apply For the purposes of section 6(a) of the Act, the Act does not apply to the following building work if it is to be carried out under a contract that applies to one only of the following— (a) attaching external fixtures (including awnings, security screens, insect screens and balustrades); (b) draining work as defined in section 85(1) of the Building Control (Plumbers, Gasfitters and Drainers) Act 1981; (c) electrical work; (d) glazing; (e) installing floor coverings; (f) insulating; (g) painting; (h) plastering; (i) plumbing work as defined in section 85(1) of the Building Control (Plumbers, Gasfitters and Drainers) Act 1981; (j) tiling (wall and floor). 5. Type of cost plus contract allowed For the purposes of section 13(1)(a) of the Act, the classes of cost plus contracts allowed are— (a) contracts for work that it is reasonably estimated will cost $500,000 or more; and r. 3 -- 3 of 7 -- S.R. No. 32/1996 Domestic Building Contracts and Tribunal (General) Regulations 1996 3 (b) domestic building contracts for public construction as defined in section 3(1) of the Project Development and Construction Management Act 1994 where the Crown or a public statutory authority is a party to the contract. 6. Progress payments For the purposes of section 40(4) of the Act, the prescribed manner of agreement is to include in the domestic building contract— (a) a warning in the form of Form 1 of the Schedule which is to be signed by the building owner before the execution of the contract; and (b) a clause in the form of Form 2 of the Schedule. __________________ r. 6 -- 4 of 7 -- S.R. No. 32/1996 Domestic Building Contracts and Tribunal (General) Regulations 1996 4 SCHEDULE FORM 1 Regulation 6(a) WARNING TO OWNER — CHANGE OF LEGAL RIGHTS Section 40 of the Domestic Building Contracts and Tribunal Act 1995 provides that a builder cannot charge more than a fixed percentage of the total contract price at the completion of each stage of building a home. The Act also allows the parties to agree in writing to change the stages and the percentage of the contract price to be paid at the completion of each stage. There are several ways in which a particular contract can vary from the normal, and it is these exceptional cases which have caused the law to allow for these changes. Examples would include— • where it is very expensive to prepare the land for building for example, where the site is steep or rocky; • where the house is so large that it will take a long time to complete, and intermediate progress payments are therefore required; • where exceptionally expensive finishes are required, meaning that the final stage will represent a much larger proportion of the whole price; • where an architect is engaged to independently assess the value of completed work for progress payments. You should not agree to progress payments different from that provided in the Act unless your house is unusual in some way and you are SURE THAT DIFFERENT PROGRESS PAYMENTS ARE NECESSARY and you understand clearly why the change is needed in the case of your particular house. Sch. -- 5 of 7 -- S.R. No. 32/1996 Domestic Building Contracts and Tribunal (General) Regulations 1996 5 If you have any doubts, you could contact— Housing Industry Association The Master Builders' Association of Victoria Office of Fair Trading and Business Affairs Royal Australian Institute of Architects .................................................... I acknowledge that I have read this warning before signing the contract Signature of Building Owner __________________ Sch. -- 6 of 7 -- S.R. No. 32/1996 Domestic Building Contracts and Tribunal (General) Regulations 1996 6 FORM 2 Regulation 6(b) Progress payments The parties agree— (i) that the progress payments fixed by section 40 of the Domestic Building Contracts and Tribunal Act 1995 do not apply; and (ii) that instead the percentages of the contract price and amounts payable are as follows— Name of stage If this stage is not the same as a stage defined in section 40(1) of the Domestic Building Contracts and Tribunal Act 1995, what does this stage mean? Percentage of total contract price $ ═══════════════ Sch. -- 7 of 7 --