Tasmania: Residential Building Work Contracts and Dispute Resolution Act 2016 (Tas)

Residential Building Work Contracts and Dispute Resolution Act 2016 An Act to regulate certain residential building contracts, to provide for the resolution of disputes arising under or related to such contracts, to amend the Judicial Review Act 2000 , to repeal the Housing Indemnity Act 1992 , and for related purposes [Royal Assent 7 October 2016] Be it enacted by Her Excellency the Governor of Tasmania, by and with the advice and consent of the Legislative Council and House of Assembly, in Parliament assembled, as follows: PART 1 - Preliminary 1. Short title This Act may be cited as the Residential Building Work Contracts and Dispute Resolution Act 2016 . 2. Commencement This Act commences on a day to be proclaimed. 3. Act binds Crown This Act binds the Crown in right of Tasmania and, so far as the legislative power of Parliament permits, in all its other capacities. PART 2 - Interpretation 4. Definitions (1) In this Act, unless the contrary intention appears – appropriate variation document means a variation document that complies with the formal requirements specified in section 18(2) ; building includes a proposed building or part of a building and a building that is able to be relocated; building contractor means a person who performs, has performed, or intends to perform, residential building work; building site means a place where residential building work has been, is being, or is to be, performed; business day means a day that is not a Saturday, a Sunday, a statutory holiday as defined in the Statutory Holidays Act 2000 or a public holiday throughout the State; contract price, in relation to a residential building work contract, means the total amount payable under the contract for the performance of residential building work under the contract and includes – (a) an amount in relation to labour and materials; and (b) an amount the building contractor is entitled to receive and keep under the contract; and (c) an amount the building contractor is entitled to receive under the contract for payment to another person; cost-plus contract means a residential building work contract under which the amount the building contractor is to receive under the contract cannot be calculated when the contract is entered into; date of practical completion, in relation to a residential building work contract, means the day by which – (a) the residential building work to be performed under the contract is completed in compliance with the contract, including all plans and specifications for the work and all statutory requirements applying to the work; and (b) the residential building work to be performed under the contract is completed without any defects or omissions, other than minor defects, or minor omissions, that will not unreasonably affect occupation; and (c) if the owner claims there are minor defects or minor omissions – the building contractor has given the owner a defects document for the minor defects or minor omissions; defects document, for a residential building work contract, means a document that – (a) lists the minor defects, and minor omissions, in the residential building work performed under the contract, that the building contractor and the owner agree exist; and (b) states when the building contractor is to remedy the minor defects and minor omissions referred to in paragraph (a) ; and (c) lists the minor defects, and minor omissions, in the residential building work performed under the contract, that the owner claims exist and the building contractor does not agree exist; and (d) is signed by the building contractor; deposit, in relation to a residential building work contract, includes any payment for residential building work demanded or received by the building contractor before the residential building work begins to be performed under the contract; Director means the Director of Building Control appointed under section 15 of the Building Act 2016 ; fixed-price contract means a residential building work contract that is not a cost-plus contract; Guide to Standards and Tolerances means a guide approved under section 82(1) ; materials, in relation to residential building work, includes goods to be supplied and fitted or installed in the course of the residential building work; member of a panel means – (a) a member of a mediation panel who is appointed under section 49(2) ; and (b) NCC means the National Construction Code series, published by the Australian Building Codes Board, as varied or replaced from time to time; owner means a person for whom residential building work is being, is to be, or has been, performed; perform, in relation to residential building work, includes – (a) cause residential building work to be carried out; and (b) manage, or arrange, the carrying out of residential building work; prime cost item, in relation to a residential building work contract, means an item, (including, but not limited to, a fixture or fitting) – (a) that has not been selected, or the price of which is not known, when the contract is entered into; and (b) for the cost of supply and delivery of which a reasonable allowance is, or is to be, made in the contract by the building contractor; progress payment, in relation to a residential building work contract, means a payment of an amount that is a part of the contract price for the contract, but does not include a payment of an amount that is, or is in the nature of, a deposit under the contract; provisional sum has the meaning it has in section 7 ; residential building has the meaning it has in section 5 ; residential building consumer guide means a residential building consumer guide approved under section 81(1) ; residential building work has the meaning it has in section 6 ; residential building work contract means a contract between a building contractor and an owner for the performance by the building contractor of residential building work, but does not include – (a) a contract between a building contractor and a subcontractor or supplier; or (b) a contract between a building contractor and an owner builder within the meaning of the Building Act 2016 ; statutory warranty means a warranty arising under Part 6 ; structure includes a proposed structure, a part of a structure and a temporary structure; subcontract, in relation to residential building work, means a contract for the performance of residential building work for a building contractor who is obliged, under a residential building work contract, to perform residential building work; subcontractor means a person who contracts to perform residential building work for a building contractor who is obliged, under a residential building work contract, to perform residential building work; supplier means a person who supplies goods or services related to the performance of residential building work; temporary structure includes any – (a) structure that does not form part of the land and is temporary; and (b) structure of a prescribed type; variation, in relation to a residential building work contract, means – (a) an addition of residential building work to the residential building work to be performed under the contract; or (b) an omission of residential building work from the residential building work to be performed under the contract – but, for a cost-plus contract, an addition or omission is a variation only if the addition or omission is not reasonably contemplated by the contract; variation document means a document setting out a variation to a residential building work contract. (2) In this Act – (a) a reference to the building contractor, in relation to a residential building work contract, is a reference to the building contractor referred to in the contract; and (b) a reference to the owner, in relation to a residential building work contract, is a reference to the owner referred to in the contract; and (c) a reference to performing residential building work, or residential building work performed, under a residential building work contract includes a reference to residential building work that a building contractor arranges, or manages the carrying out of, under a subcontract in order to comply with the building contractor's obligations under the residential building work contract. 5. Meaning of residential building (1) In this Act, a residential building is a building, or structure, that is classified under Volume One of the NCC as – (a) a class 1a building; or (b) a class 2 building; or (c) a class 10 building, if that building is associated with a class 1a building or class 2 building. (2) Despite subsection (1) , the following are not residential buildings for the purposes of this Act: (a) a caravan or any motor vehicle, trailer, aeroplane, or boat, used as a residence; (b) a boarding house, guest house, hostel or lodging house; (c) a motel, residential club, residential hotel or residential part of licensed premises, within the meaning of the Liquor Licensing Act 1990 , or any other building or structure, or part of a building or structure, used or intended to be used as tourist, holiday or overnight accommodation; (d) a residential part of an educational institution; (e) a hospital or care institution; (f) if a building or structure contains only one residence and that residence is used, or is intended to be used, by a caretaker for the building or structure – that part of the building comprising the residence; (g) a prison within the meaning of the Corrections Act 1997 , a detention centre within the meaning of the Youth Justice Act 1997 , or premises, or part of premises, where offenders on remand are held or it is intended that such offenders are to be held; (h) Government House; (i) a building, structure or other thing that is prescribed by the regulations not to be a residential building. (3) In subsection (2) – care institution means an institution where accommodation and personal, nursing or medical care are provided to elderly, sick or rehabilitating persons, but does not include an institution for persons otherwise living independently even though the provision of accommodation may include domestic services such as the preparation of meals, cleaning and laundry services. (4) If a building or structure, or part of a building or structure, constitutes a residential building, the following structures, fixtures and fittings are taken to be part of the residential building: (a) all structures, fixtures and fittings that form part of the residential building or are used for, or partly for, the purposes of the residential building; (b) any thing that is prescribed by the regulations to be such a structure, fixture or fitting. (5) For the purposes of subsection (4) , the structures, fixtures and fittings that form part of the residential building or are used for, or partly for, the purposes of the residential building include, but are not limited to, passageways, retaining structures, driveways, paths, fencing, paving, garages, carports, workshops, storage sheds, swimming pools and spas. (6) Despite subsection (4) , a structure, fixture or fitting that forms part of a residential building or is used for or partly for the purposes of a residential building is not taken to be part of the residential building under that subsection if the regulations prescribe that it is not to be so taken. 6. Meaning of residential building work (1) In this section – fire safety system includes – (a) a booster assembly; and (b) fire mains, hydrants and hose reels; and (c) sprinklers; and (d) fire and smoke alarms; and (e) fire control centres; and (f) structures or devices to mitigate the fire hazard in respect of special fire hazard buildings, within the meaning of the Building Regulations; and (g) stairwell pressurisation; and (h) air-handling systems; and (i) smoke and heat vents; plumbing system means – (a) a water supply system; or (b) a system of sewage, or of sullage, drainage or removal; or (c) a system of storm water drainage or roof drainage; or (d) an on-site waste water management system; relevant system means any of the following: (a) a system for lighting, heating, ventilation, air conditioning or cooling; (b) a power supply system; (c) a sewerage, water supply, or drainage, system; (d) a communications system; (e) a fire safety system; (f) a security system; (g) a plumbing system; (h) a gas supply system. (2) For the purposes of this Act, the following work is residential building work: (a) erecting, re-erecting, constructing, altering, repairing, underpinning, demolishing or removing a residential building; (b) adding to, or removing a part of, a residential building; (c) the restoration, maintenance, renovation, alteration, extension, improvement or repair of a residential building; (d) work, on the land on which building work referred to in paragraph (a) , (b) or (c) is being, or is to be, carried out, that is work in preparation for the use of that land for residential purposes or in preparation for that or other residential building work, including, but not limited to – (i) work required to gain access, or to remove impediments to access, to that land, part of that land or other land related to any other residential building work, including the construction of a road to enable access to the residential building or to that land or part of that land; and (ii) site clearance, earth moving, excavation, tunnelling, boring and filling; and (iii) the preparation of foundations; and (iv) the erection, maintenance or dismantling of plant and equipment; and (v) work required in preparation for the erection of a prefabricated dwelling; (e) all associated work carried out in conjunction with work referred to in paragraph (a) , (b) or (c) including, but not limited to – (i) the provision, installation, alteration, repair or removal, of all, or a part of, a relevant system in relation to the residential building or the land on which the residential building is, or is to be, situated; and (ii) the erection, re-erection, construction, alteration, repair or removal of buildings, structures and fixtures associated with a residential building; and (iii) the cleaning, painting and decorating of the inside and outside surfaces of the residential building; and (iv) paving; and (v) landscaping and site restoration; (f) the prefabrication of any component that is to form part of a residential building, including the manufacture of a prefabricated dwelling, regardless of where that prefabrication is carried out; (g) any work carried out on any part of a prefabricated dwelling, or on any prefabricated component of a dwelling, in preparation for the erection of the prefabricated dwelling or component, regardless of where that work is carried out; (h) any other work that is prescribed by the regulations to be residential building work. (3) Although a caravan, motor vehicle, trailer, aeroplane or boat is not a residential building, if the caravan, motor vehicle, trailer, aeroplane or boat is, or is to be, used as a residence on any land, the following work is residential building work: (a) all work done in relation to the use of the land for residential purposes, including, but not limited to, landscaping, paving and the erection, construction or removal of any building or fixture associated with the caravan, motor vehicle, trailer, aeroplane or boat; (b) the provision of water supply, sewerage or drainage to the land on which the caravan, motor vehicle, trailer, aeroplane or boat is, or is to be, situated; (c) loading, unloading or transporting a building or structure that, if fixed to land, could be a residential building, regardless of whether the loading, unloading or transportation is solely on the land on which the building or structure was or is to be located; (d) loading, unloading or transporting a prefabricated building or structure that, if fixed to land, could be a residential building, regardless of whether – (i) the building or structure is whole or in parts; and (ii) the loading, unloading or transportation is solely on the land on which the building or structure was or is to be located; (e) any other work that is prescribed by the regulations to be residential building work in relation to the land on which the caravan, motor vehicle, trailer, aeroplane or boat is, or is to be, situated. (4) For the purposes of subsections (2) and (3) , buildings and fixtures associated with a residential building or a caravan, motor vehicle, trailer, aeroplane or boat include, but are not limited to, passageways, retaining structures, driveways, paths, fencing, paving, garages, carports, workshops, storage sheds, swimming pools and spas. (5) Despite subsections (2) and (3) , the following work is not residential building work for the purposes of this Act: (a) any delivery of materials; (b) any work that is exempted from the application of this Act in accordance with section 10 ; (c) work for the purposes of the subdivision of land; (d) work in relation to a building, caravan, motor vehicle, trailer, aeroplane, or boat, intended to be used only for business purposes; (e) work in relation to a building, caravan, motor vehicle, trailer, aeroplane, or boat, intended to be used only for the accommodation of animals; (f) other work that is prescribed by the regulations not to be residential building work. 7. Meaning of provisional sum (1) In this Act, a provisional sum, in relation to a residential building work contract, is an amount that is an estimate, of the cost of performing a part of the residential building work to be performed under the contract (including the cost of supplying any materials needed for the residential building work), that is made by the building contractor. (2) Without limiting the generality of subsection (1) , a building contractor may estimate an amount under that subsection in relation to residential building work on the basis of – (a) written advice, in relation to the work, provided by the designer or the owner; or (b) an amount, in relation to all or part of the work, that is specified in a schedule to a design, or to a tender, that relates to the work. (3) However, subsection (1) only applies to a part of residential building work to which the relevant residential building work contract relates if the building contractor, after making all reasonable enquiries, cannot state a definite amount in relation to the part of the contract work when the contract is entered into. 8. Certain contracts taken to be one contract (1) This section applies if a building contractor and an owner enter into 2 or more separate contracts that – (a) could be the subject of a single contract that relates to the performance of residential building work by the building contractor; and (b) if they were a single contract, would be a residential building work contract. (2) The separate contracts are taken to be a single contract for which the contract price is the sum of the contract prices for the separate contracts. PART 3 - Application 9. Application of Act This Act does not apply to, or in relation to, residential building work that – (a) is performed, or is to be performed, for a contract price that is less than $20 000 or another greater amount, if any, that is prescribed by the regulations; or (b) is begun before the commencement of this Act, or performed, in pursuance of a residential building work contract entered into before the commencement of this Act; or (c) consists solely of demolition work; or (d) is exempted from this Act in accordance with section 10 . 10. Exemptions from application of Act The regulations may provide for the exemption of any specified residential building work, or class of residential building work, from the application of this Act or a specified provision of this Act, either unconditionally or subject to any conditions specified in the regulations. PART 4 - Functions and Powers of Director 11. Functions and powers of Director (1) In addition to his or her functions under any other Act, the Director has the following functions: (a) to investigate and research matters relevant to residential building work contracts; (b) to publish reports and information relevant to residential building work contracts; (c) to inform the public about the provisions of this Act; (d) to report to the Minister in relation to – (i) the Director's functions; and (ii) matters, referred to the Director by the Minister, in relation to residential building work contracts; (da) to advise, and make recommendations to, the Minister in respect of matters relating to residential building work disputes generally; (e) to assist in the administration of the provision of mediation and adjudication under this Act. (2) The Director has the powers necessary to perform his or her functions under this Act. 11A. Director may make determination in certain circumstances (1) In this section – mediation panel has the same meaning as in Part 9 ; notice of dispute has the same meaning as in Part 9 . (2) The Director may make a determination in respect of the following matters: (a) the provisions that must be included in a residential building work contract; (b) details of the information to be provided as part of a notice of dispute; (c) the timing of processes relating to a notice of dispute, or a mediation panel, not otherwise specified in this Act; (d) the qualifications required to be held by a person for the person to be appointed to a mediation panel; (e) any other matter relating to a notice of dispute, or mediation panel, not otherwise specified in this Act. (3) A determination made under subsection (2) – (a) must be published before it comes into effect; and (b) is to specify the date on which it takes effect; and (c) must remain so published while the determination remains in effect. (4) For the purposes of subsection (3) , a determination is published if – (a) the determination is made available for viewing by members of the public on a website that is freely accessible by the public; or (b) the determination is made available for viewing by, or accessible to, members of the public by any other means that the Director considers appropriate. (5) A determination made under subsection (2) does not apply in respect of a notice of dispute, or a mediation panel, if – (a) in the case of a notice of dispute, the notice is lodged under Part 9 before the determination takes effect; and (b) in the case of a mediation panel, the panel is established under Part 9 before the determination takes effect. (6) A notice made by the Director under section 14 (2) that is in force immediately before the commencement of section 52 of the Residential Building (Miscellaneous Consumer Protection Amendments) Act 2023 is taken, on and after the commencement of that section, to be a determination made under this section until it ceases to be in force, according to its terms, or is revoked. 12. Delegation The Director may delegate to a person any of the Director's functions or powers under this Act, other than this power of delegation. PART 5 - Contracts Division 1 - Contracts generally 13. Contracts must be in writing A building contractor who enters into a residential building work contract must ensure the contract – (a) is in written form when it is entered into; or (b) is put into written form – (i) as soon as practicable (but in any case within 5 business days) after it is entered into; and (ii) before residential building work begins to be performed under the contract. Penalty: In the case of – (a) a body corporate, a fine not exceeding 800 penalty units; or (b) an individual, a fine not exceeding 300 penalty units. 14. General contents of contracts (1) A building contractor who enters into a residential building work contract must ensure the contract – (a) is in English and is readily legible; and (b) sets out in full all the terms of the contract; and (c) specifies the names of the parties to the contract; and (d) if the building contractor holds a licence under the Occupational Licensing Act 2005 , specifies the number of the licence; and (e) includes a description of, and any plans or specifications in relation to, the residential building work to be performed under the contract; and (f) specifies either – (i) the contract price; or (ii) a method for calculating the contract price and an estimate of the contract price, as determined in accordance with the method of calculation, that is fair and reasonable; and (g) specifies the date of practical completion or the method for estimating the date of practical completion; and (h) sets out the warranties that are part of the contract under Part 6 ; and (i) sets out provisions in relation to the matters, if any, specified in a determination, made under section 11A , for the purposes of this section; and (j) includes the required checklist in relation to the contract; and (k) has attached to it a copy of a residential building consumer guide that is in effect under section 81(3) , unless the building contractor has already given to the owner a copy of the guide. Penalty: In the case of – (a) a body corporate, a fine not exceeding 800 penalty units; or (b) an individual, a fine not exceeding 300 penalty units. (2) . . . . . . . . (3) For the purposes of subsection (1)(j) , a required checklist is a document containing, in language that is readily comprehensible, a summary of the provisions of the residential building work contract to which the checklist relates. 15. Contracts must be signed A residential building work contract has effect only if it is signed by the building contractor and the owner (or their authorised agents). 16. Copy of contract for owner As soon as practicable (but in any case within 5 business days) after entering into a residential building work contract, the building contractor must give the owner a readily legible signed copy of the contract, to which is attached the residential building consumer guide required under section 14(1)(k) to be attached to the contract, unless the building contractor has already given to the owner under section 39(1) a copy of the guide. Penalty: In the case of – (a) a body corporate, a fine not exceeding 800 penalty units; or (b) an individual, a fine not exceeding 300 penalty units. Division 2 - Variations of contracts 17. Variations must be in writing (1) A building contractor must ensure any variation of the residential building work contract agreed to between the building contractor and the owner is put into written form – (a) within the shortest practicable time; and (b) for a variation consisting of an addition to the residential building work to be performed under the contract – before any residential building work to which the variation relates begins to be performed. Penalty: In the case of – (a) a body corporate, a fine not exceeding 300 penalty units; or (b) an individual, a fine not exceeding 100 penalty units. (2) Subsection (1) does not apply to a building contractor for a variation of a residential building work contract if – (a) the variation is in relation to residential building work that is required to be performed urgently; and (b) it is not reasonably practicable, in the particular circumstances, to produce a variation document before the residential building work to which the variation relates begins to be performed. (3) For the purposes of subsection (2) , the circumstances in which residential building work may be required to be performed urgently include, but are not limited to, where the condition of the building site on which the residential building work is to be performed requires an alteration to the work and the condition could not have been discovered, before the work begins to be performed, by reasonably diligent investigation. (4) Subsection (5) applies if – (a) a proposed variation of a residential building work contract has not yet been agreed to between the building contractor under the contract and the owner, but is proposed to come into existence on the signing of a variation document by the owner and the building contractor; and (b) the variation document is to be the first and only agreement between the building contractor and the owner for the particular variation. (5) A building contractor must ensure that no residential building work to which a proposed variation of a residential building work contract relates is performed until the variation document has been signed by the building contractor and the owner, if the proposed variation consists of – (a) an addition to the residential building work that is to be performed under the contract; or (b) a variation sought by the owner. Penalty: In the case of – (a) a body corporate, a fine not exceeding 300 penalty units; or (b) an individual, a fine not exceeding 100 penalty units. 18. General contents of variation document (1) The building contractor under a residential building work contract must ensure a variation document in respect of the contract complies with the formal requirements for a variation document. Penalty: In the case of – (a) a body corporate, a fine not exceeding 300 penalty units; or (b) an individual, a fine not exceeding 100 penalty units. (2) A variation document in respect of a residential building work contract complies with the formal requirements for a variation document if the document – (a) is in English and is readily legible; and (b) describes the variation; and (c) where the variation was sought by the building contractor – states the reason for the variation; and (d) where the variation will result in a delay affecting the residential building work to be performed under the contract – states the building contractor's reasonable estimate for the period of delay; and (e) for a fixed-price contract – states the change of the contract price because of the variation, or how the change of the contract price is to be determined; and (f) for a cost-plus contract – states a fair and reasonable estimate of the costs associated with the addition or omission the subject of the variation; and (g) if the contract provides for progress payments – makes appropriate provision for payments under the contract to reflect any change, to the contract price, caused by the variation. 19. Variation document must be signed As soon as practicable after an appropriate variation document is made, the building contractor must – (a) sign the document; and (b) take all reasonable steps to ensure the document is signed by the owner. Penalty: In the case of – (a) a body corporate, a fine not exceeding 300 penalty units; or (b) an individual, a fine not exceeding 100 penalty units. 20. Copy of variation document for owner (1) As soon as practicable (but in any case within 5 business days) after a variation of a residential building work contract is agreed to between the building contractor and the owner, the building contractor must give the owner – (a) a readily legible copy of an appropriate variation document for the variation signed by the building contractor and the owner; or (b) if acceptable circumstances apply to the building contractor – a readily legible copy of an appropriate variation document for the variation, signed by the building contractor. Penalty: In the case of – (a) a body corporate, a fine not exceeding 300 penalty units; or (b) an individual, a fine not exceeding 100 penalty units. (2) For the purposes of subsection (1)(b) , acceptable circumstances apply to the building contractor if the building contractor has taken all reasonable steps to ensure an appropriate variation document for the variation is signed by the owner, but the owner has not signed the document. 21. Where variation requires consent by building surveyor or authorisation to be obtained (1) In this section – certificate of likely compliance means a certificate of likely compliance issued under the Building Act 2016 . (2) If a variation of a residential building work contract is such that residential building work, if performed in accordance with the variation, would require the consent, under the Building Act 2016 , of a building surveyor because it varies from the residential building work to which a certificate of likely compliance relates, the building contractor must ensure that – (a) the copy of the variation document provided to the owner has attached to it the written consent of a building surveyor to the residential building work to be performed in accordance with the variation; and (b) residential building work in accordance with the variation is not performed until paragraph (a) has been complied with. Penalty: In the case of – (a) a body corporate, a fine not exceeding 300 penalty units; or (b) an individual, a fine not exceeding 100 penalty units. (3) If a variation to a residential building work contract relates to residential building work in relation to which a permit, or other authorisation, under the Land Use Planning and Approvals Act 1993 or the Building Act 2016 is required, the building contractor must ensure that – (a) the residential building work to which the variation relates is authorised by the permit or other authorisation, or if the permit or authorisation required amendment in order for the work to be authorised, has been so amended; and (b) the copy of the variation document provided to the owner has attached to it a copy of the permit or other authorisation, as so amended, if at all; and (c) residential building work in accordance with the variation is not performed until paragraph (b) has been complied with. Penalty: In the case of – (a) a body corporate, a fine not exceeding 300 penalty units; or (b) an individual, a fine not exceeding 100 penalty units. PART 6 - Statutory Warranties in Contracts Division 1 - Statutory warranties for all residential building work contracts 22. Implied warranties The warranties on the part of the building contractor that are contained in this Division are implied in a residential building work contract. 23. Suitability of materials (1) In this section – relevant criteria, for materials, means – (a) generally accepted practices, or standards, applied in the building industry for the materials; or (b) specifications, instructions or recommendations of manufacturers or suppliers of the materials; responsible person, in relation to a residential building work contract, means the person who carries out residential building work required to be performed under the contract. (2) The building contractor warrants that all materials to be supplied for use in the residential building work to which the relevant residential building work contract relates – (a) will be good and, having regard to the relevant criteria, suitable for the purpose for which they are used; and (b) unless otherwise stated in the contract, will be new. (3) Subsection (2) applies to the building contractor in relation to materials only if the materials are supplied by the responsible person in relation to the residential building work contract. (4) Despite subsection (3) , if the residential building work contract is being administered by – (a) an agent of the owner; or (b) an architect, engineer, or building designer, who is engaged by the building owner – subsection (2) does not apply to the owner in relation to materials if the responsible person is subject to the direction of the agent, architect, engineer or building designer for supplying the materials. (5) Also, despite subsection (3) , subsection (2) does not apply to the building contractor for materials if – (a) the owner is responsible for nominating the materials for use in the residential building work to which the relevant residential building work contract relates; and (b) either – (i) there are no reasonable grounds for not using the materials; or (ii) if there are reasonable grounds for not using the materials – the owner insists on the materials being used despite written advice to the contrary given to the owner by the building contractor. 24. Compliance with legal requirements The building contractor warrants the residential building work to be performed under the relevant residential building work contract will be performed in accordance with all relevant laws and legal requirements. 25. Standard of work and exercise of care and skill The building contractor warrants the residential building work to be performed under the relevant residential building work contract will be performed – (a) in an appropriate and skilful way; and (b) with reasonable care and skill. Division 2 - Statutory warranties for particular contracts 26. Implied warranties The warranties on the part of the building contractor that are contained in a provision in this Division are implied in a residential building work contract to which the provision applies. 27. Adherence to plans and specifications (1) This section applies to a residential building work contract if plans and specifications form part of the contract. (2) The building contractor warrants the residential building work to be performed under the relevant residential building work contract will be performed in accordance with the plans and specifications. 28. Suitability of residential building for occupation (1) This section applies to a residential building work contract if the residential building work to be performed under the contract – (a) consists of the erection or construction of a residential building to a stage suitable for occupation; or (b) is work intended to renovate, alter, extend, improve or repair a residential building to a stage suitable for occupation. (2) The building contractor warrants the residential building will be suitable for occupation when the residential building work is completed. 29. Carrying out work with reasonable diligence The building contractor warrants that the residential building work to be performed under the relevant residential building work contract will be performed with reasonable diligence. 30. Calculation of provisional sums and prime cost items (1) This section applies to a residential building work contract if the contract provides for a provisional sum or a prime cost item. (2) The building contractor warrants the provisional sum or prime cost item has been calculated with reasonable care and skill, having regard to all the information reasonably available when the residential building work contract is entered into, including information about the nature and location of the building site. (3) Without limiting the circumstances in which a provisional sum may be taken to have been calculated with reasonable care and skill, a provisional sum is to be taken to have been calculated with reasonable care and skill if it has been, in relation to residential building work, calculated by the building contractor on the basis of – (a) written advice, in relation to the work, provided by the designer or the owner; or (b) an amount, in relation to all or part of the work, that is specified in a schedule to a design, or to a tender, that relates to the work. Division 3 - Effect of statutory warranties 31. Succession to statutory warranties (1) A person who purchases or otherwise acquires a residential building succeeds to the rights, in respect of statutory warranties, of his or her predecessor in title. (2) If a person purchases a residential building from a building contractor who has performed residential building work in relation to the residential building, the purchaser is entitled to the benefit of the statutory warranties as if the building contractor had performed the residential building work for the purchaser pursuant to a residential building work contract. (3) A person who purchases or otherwise acquires a residential building in relation to which an owner builder, within the meaning of the Building Act 2016 , performed residential building work is entitled to the benefit of the statutory warranties in relation to the residential building as if the owner builder had performed the residential building work for the person pursuant to a residential building work contract. 32. Proceedings for breach of statutory warranty (1) Proceedings for a breach of a statutory warranty are to be commenced within 6 years after the date of practical completion of the residential building work to which the proceedings relate. (2) Subsection (3) applies in relation to residential building work if – (a) proceedings, for a breach of a statutory warranty, are to be or have been commenced, in relation to the residential building work, by or on behalf of a person who is entitled under section 31(2) or (3) to the benefit of a statutory warranty in relation to the residential building work; and (b) but for the application of subsection (3) , the person bringing the proceeding could not, by reasonable diligence, establish for the purposes of subsection (1) the date of practical completion of the work. (3) If this subsection applies in relation to residential building work, the date of practical completion of the residential building work is to be taken to be – (a) the date on which a certificate of completion (building work), within the meaning of the Building Act 2016 , is issued in relation to the residential building work; or (b) if – (i) paragraph (a) does not apply in relation to the residential building work; and (ii) an occupancy permit, within the meaning of the Building Act 2016 , is issued in relation to the residential building to which the work relates before the building is first occupied after the residential building work is carried out – the date on which the occupancy permit is issued; or (c) if – (i) paragraphs (a) and (b) do not apply in relation to the residential building work; and (ii) a building permit was required under the Building Act 2016 for the carrying out of the residential building work – the date that is 2 years after the date on which the building permit was issued; or (d) if – (i) paragraphs (a) , (b) and (c) do not apply in relation to the residential building work; and (ii) the authorisation of a building surveyor was required under the Building Act 2016 for the carrying out of the residential building work – the date that is 2 years after the date on which the authorisation was given by a building surveyor. (4) 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 given by the owner contrary to the advice in writing of the defendant. PART 7 - Cooling-off Period 33. Right of owner to withdraw from contract in cooling-off period (1) In this section – receipt day, for a residential building work contract, means – (a) the day on which the owner receives the following documents from the building contractor: (i) a copy of the signed contract; (ii) a copy of the residential building consumer guide that is in effect under section 81(3) ; or (b) if the documents mentioned in paragraph (a) are received by the owner from the building contractor on different days – the later of the days. (2) The owner under a residential building work contract may withdraw from the contract under this section. (3) The owner may withdraw from the contract within 5 business days after the receipt day for the contract. (4) If 5 business days have elapsed since the contract was entered into and there is no receipt day for the contract, the owner may withdraw from the contract. (5) Nothing in subsection (4) affects the right of the owner to withdraw from the contract under subsection (3) if a receipt day subsequently applies to the contract. 34. Restrictions affecting right of withdrawal in cooling-off period (1) In this section – formal legal advice means independent advice – (a) given by a practising legal practitioner; and (b) for the giving of which an amount is paid, or is payable, to the legal practitioner by the person to whom the advice is given; practising legal practitioner means an Australian legal practitioner authorised under a law of the State to practise as a lawyer for purposes including the giving, for reward, of advice, including, for example, advice about residential building work contracts. (2) This section applies despite section 33 . (3) An owner may not withdraw from a residential building work contract (the current contract) under section 33 if – (a) the owner and building contractor previously entered into a residential building work contract (the previous contract); and (b) the terms of the previous contract and current contract are substantially the same; and (c) the contracted services for the previous contract and current contract – (i) are substantially the same; and (ii) relate to the same residential building or land. (4) Also, an owner may not withdraw from a residential building work contract under section 33 if – (a) before entering into the contract, the owner received formal legal advice about the contract; or (b) when, or after, the contract is entered into, the owner tells the building contractor that the owner received formal legal advice about the contract before entering into the contract. 35. Right of owner to withdraw from contract if cooling-off warning not given (1) This section applies if an owner has not received from the building contractor a residential building consumer guide that is in effect under section 81(3) . (2) The owner may withdraw from the contract within 7 days of becoming aware that the owner should have received from the building contractor a residential building consumer guide that is in effect under section 81(3) . 36. Withdrawal procedure (1) In this section – withdrawal notice means a written notice signed by the owner, in relation to a residential building work contract, stating – (a) that the owner withdraws from the contract; and (b) the section of this Act under which the withdrawal is made. (2) To withdraw from a residential building work contract under section 33 or 35 , the owner must, within the time allowed under the section for the withdrawal – (a) give a withdrawal notice to the building contractor; or (b) leave a withdrawal notice at the address shown as the building contractor's address in the contract; or (c) serve a withdrawal notice on the building contractor in accordance with any provision in the contract providing for service of notices on the building contractor by the owner. 37. Rights and obligations of parties following withdrawal in cooling-off period (1) In this section – pre-paid amount, in relation to a contract, means the amount paid to the building contractor under the contract by the owner before the owner withdrew from the contract; retainable amount, in relation to a contract, means the sum of – (a) $100; and (b) an amount equal to any out-of-pocket expenses reasonably incurred in relation to the contract by the building contractor before the owner withdrew from the contract. (2) This section applies if an owner withdraws from a residential building work contract under section 33 . (3) If there is a pre-paid amount for the contract that is not less than the retainable amount, the building contractor – (a) may keep an amount equal to the retainable amount out of the pre-paid amount; and (b) must refund any balance of the pre-paid amount to the owner. (4) If there is a pre-paid amount for the contract that is less than the retainable amount, the owner must pay the building contractor an amount equal to the difference between the retainable amount and the pre-paid amount. (5) If there is no pre-paid amount for the contract, the owner must pay the building contractor an amount equal to the retainable amount. (6) If an amount is not paid by a person as required under this section, the person to whom it is payable may recover the amount from the other person as a debt. (7) Except as provided under subsection (4) or (5) , the owner is not liable to the building contractor in any way for withdrawing from the contract. 38. Rights of building contractor following withdrawal for failure to give warning (1) This section applies if an owner withdraws from a residential building work contract under section 35 . (2) The building contractor is entitled to receive a reasonable amount for the performance of residential building work under a residential building work contract before the time of withdrawal. (3) However, the building contractor is not entitled to receive an amount that is more than the amount the building contractor would have been entitled to receive under the contract. PART 8 - Obligations of Building Contractor 39. Building contractor must give owner copy of residential building consumer guide (1) A building contractor must, before the building contractor or the owner enters into a residential building work contract, give the owner a copy of the residential building consumer guide that is in effect under section 81(3) . Penalty: In the case of – (a) a body corporate, a fine not exceeding 300 penalty units; or (b) an individual, a fine not exceeding 100 penalty units. (2) A document, signed by an owner, containing a statement that a building contractor has given the owner a copy of the residential building consumer guide that is in effect under section 81(3) is evidence of that matter and, in the absence of evidence to the contrary, is proof of that matter. 40. Building contractor to give commencement notice (1) A building contractor must, within 10 business days after residential building work to which a residential building work contract relates begins to be performed, give to the owner a commencement notice. Penalty: In the case of – (a) a body corporate, a fine not exceeding 300 penalty units; or (b) an individual, a fine not exceeding 100 penalty units. (2) For the purposes of subsection (1) , a commencement notice is a notice, signed by the building contractor in relation to a residential building work contract, stating – (a) the day on which the residential building work to be performed under the contract began to be performed; and (b) the estimated date of practical completion in relation to the contract. 41. Deposits (1) In this section – off-site work, in relation to a residential building work contract, means work that – (a) relates to or forms part of residential building work; and (b) is performed at a place that is not the place at which an object resulting from the performance of the residential building work is to be finally installed or constructed under the contract; set amount means – (a) the amount, above $20 000, prescribed under a regulation as the set amount; or (b) if an amount is not prescribed for paragraph (a) – $20 000. (2) A building contractor must not, before starting to perform residential building work under a residential building work contract, demand or receive a deposit under the contract of more than – (a) if the contract price is equal to or more than the set amount and is not a contract price to which paragraph (c) applies –5% of the contract price; or (b) if the contract price is less than the set amount and is not a contract price to which paragraph (c) applies – 10% of the contract price; or (c) for a residential building work contract under which the value of the off-site work is more than 50% of the contract price – 20% of the contract price. Penalty: In the case of – (a) a body corporate, a fine not exceeding 800 penalty units; or (b) an individual, a fine not exceeding 300 penalty units. (3) In this section, a reference to the contract price for a contract includes, for a cost-plus contract, a reference to the estimated amount for the contract. 42. Progress payments (1) In this section – building site, in relation to a residential building work contract, does not include a place where residential building work has been, is being, or is to be, performed, if the work is required to later be installed or constructed at another place under the contract. (2) A building contractor must not demand or receive an amount, other than a deposit, under a residential building work contract unless the amount is directly related to the progress of the performance at the building site of the residential building work to be performed under the contract. Penalty: In the case of – (a) a body corporate, a fine not exceeding 800 penalty units; or (b) an individual, a fine not exceeding 300 penalty units. 43. Building contractor to give notice of practical completion (1) A building contractor must, within 10 business days after the date of practical completion in relation to a residential building work contract, give a notice of practical completion to – (a) the owner; and (b) if the residential building work to which the contract relates was work in relation to which a certificate of likely compliance is required under the Building Act 2016 to be given to a person – the person to whom the certificate is required under that Act to be given. Penalty: In the case of – (a) a body corporate, a fine not exceeding 300 penalty units; or (b) an individual, a fine not exceeding 100 penalty units. (2) For the purposes of subsection (1) , a notice of practical completion is a notice, signed by the building contractor in relation to a residential building work contract, stating that the date of practical completion has occurred. 44. Correction of minor defects and omissions (1) In this section – completion day, in relation to a residential building work contract, means the day when the residential building work to be performed under the contract is completed – (a) in compliance with the contract, including all plans and specifications for the work and all statutory requirements applying to the work; and (b) without any defects or omissions, other than minor defects, or minor omissions, that will not unreasonably affect occupation. (2) If, on or after the completion day in relation to a residential building work contract – (a) the owner claims there are minor defects or minor omissions (other than minor defects, or minor omissions, that will not unreasonably affect occupation) in relation to the residential building work performed under the contract; and (b) the building contractor agrees that there are minor defects or minor omissions (other than minor defects, or minor omissions, that will not unreasonably affect occupation) in relation to the residential building work performed under the contract – the building contractor, as soon as practicable, must give to the owner a defects document in relation to the minor defects or minor omissions. Penalty: In the case of – (a) a body corporate, a fine not exceeding 800 penalty units; or (b) an individual, a fine not exceeding 300 penalty units. (3) A building contractor, as soon as practicable, but in any case within 6 months, after giving to an owner a defects document in relation to a minor defect or minor omission, must take all reasonable steps to correct the defect or the omission. Penalty: In the case of – (a) a body corporate, a fine not exceeding 800 penalty units; or (b) an individual, a fine not exceeding 300 penalty units. (4) A building contractor – (a) does not commit an offence under subsection (3) ; and (b) is not liable under a residential building contract – in relation to any failure to correct a minor defect or minor omission in relation to the residential building work performed under a residential building work contract, if the owner does not enable the building contractor to have the access to any land, building, or structure, that the building contractor reasonably requires in order to comply with subsection (3) . PART 9 - Mediation 45. Interpretation of Part 9 In this Part – dispute means a dispute between an owner and either a building contractor or a prescribed licensed professional in relation to – (a) a residential building work contract entered into by the building contractor and the owner; or (b) the performance of residential building work under a residential building work contract entered into by the building contractor and the owner; or (c) whether a provision of this Act has been complied with by the building contractor or the owner in relation to the residential building work contract entered into by the building contractor and the owner; or (d) another matter relating to residential building work, or residential building work contracts, that has been prescribed for the purposes of this definition; mediation panel, in relation to a dispute, means a panel established under section 49(2) ; notice of dispute means a notice that is lodged under section 47(1) ; party, in relation to a dispute, means – (a) a person who has lodged under section 47(1) a notice of dispute in relation to the dispute; and (b) a person on whom a notice of dispute in relation to the dispute is served under section 47(2) ; and (c) any person who is joined under section 50(3) as a party to the mediation of the dispute; prescribed licensed professional, in respect of a class of building services work within the meaning of the Occupational Licensing Act 2005 , means a person of a class of persons who are prescribed as the licensed professionals for that class of building services work. 46. Application of Part (1) Nothing in this Part is to be taken to require a person to lodge a notice of dispute in relation to a matter before the person may exercise any other right the person may have to commence any proceedings in relation to the matter. (2) For the purposes of this Part, a reference to a residential building work contract also includes a reference to a contract, whether oral or in writing, that relates to residential building work to which this Act applies if – (a) residential building work has been performed under the contract; and (b) the contract is not in effect, under this Act, solely on the basis that the contract does not meet the requirement of section 15 . 47. Lodging of notice of dispute (1) A building contractor or an owner may lodge with the Director a notice of dispute in relation to a dispute between the building contractor and the owner. (1A) A notice of dispute may only be lodged under subsection (1) – (a) within 6 years after the date of practical completion of the residential building work to which the notice relates; or (b) if there is no date of practical completion for the residential building work to which the notice relates, within 6 years after the day on which the res