New South Wales Consolidated Acts

HOME BUILDING ACT 1989 - SECT 96

96 Insurance in relation to residential building work not carried out under contract

(1) A person must not do residential building work otherwise than under a contract unless a contract of insurance that complies with this Act is in force in relation to that work.

Maximum penalty: 1,000 penalty units in the case of a corporation and 200 penalty units in any other case.

(2) A person who does residential building work otherwise than under a contract must not enter into a contract for the sale of land on which the residential building work has been done, or is to be done, unless a certificate of insurance evidencing the contract of insurance required under this Part for that work, in a form prescribed by the regulations, is attached to the contract of sale.

Maximum penalty: 1,000 penalty units in the case of a corporation and 200 penalty units in any other case.

(2B) A person who does residential building work otherwise than under a contract must, before entering into a contract for sale of land on which the residential building work has been done, or is to be done, give the other party to the contract a brochure, in a form approved by the Director-General, containing information that explains the operation of the contract of insurance, and the procedure for the resolution of disputes under the contract.

Maximum penalty: 40 penalty units in the case of a corporation and 20 penalty units in any other case.

(3) This section does not apply:

(a) to an owner-builder, or

(b) to a person who does owner-builder work within the meaning of Division 3 of Part 3 that does not involve:

(i) the construction of a dwelling, or

(ii) the alteration of, or additions to, a dwelling, or

(iii) the construction of an inground swimming pool, or

(c) to an individual who is exempted by the regulations from the requirements of section 12, or

(d) to a sale of the land more than 6 years after the completion of the work, or

(e) if the contract price of the work did or does not exceed $5,000 or (if there is no contract price) the reasonable market cost of the labour and materials involved did or does not exceed $5,000, or

(3A) Subject to subsection (3B), if a person contravenes subsection (2) in respect of a contract for the sale of land, the contract is voidable at the option of the purchaser before the completion of the contract.

(3B) A contract is not voidable as referred to in subsection (3A) if:

(a) the person obtained a certificate of insurance evidencing a contract of insurance that complies with this Act in relation to the residential building work before entering the contract concerned, and

(b) before completion of the contract, the person served on the purchaser (or an Australian legal practitioner acting on the purchaser’s behalf) a certificate of insurance, in the form prescribed by the regulations, evidencing that contract of insurance.

(4) The regulations may prescribe another amount for the purposes of subsection (3) (e) and an amount so prescribed is to apply in the place of the amount referred to in that subsection.