Victorian Consolidated Legislation

House Contracts Guarantee Act 1987 - SECT 20

Limit on amount of deposit

20. Limit on amount of deposit



(1) A person must not demand or receive under a domestic building work
contract, or enter into a domestic building work contract under which the
person is entitled to demand or receive-

   (a)  if the contract price is $20 000 (or any larger amount that is
        prescribed for the purposes of this subsection) or more, more than 3%
        of the contract price; or

   (b)  if the contract price is less than $20 000 (or any larger amount that
        is prescribed for the purposes of this subsection), more than 10% of
        the contract price-

before the commencement of the domestic building work that is the subject of
the contract.

Penalty: 100 penalty units.

(2) For the purposes of this section, the definition of domestic building work
in section 3(1) includes the work of moving from one site to another a
building described in paragraph (d) of that definition.

(3) If a domestic building work contract contains a provision that contravenes
subsection (1), the contract is voidable at the option of the building owner
at any time before completion of the contract, unless the court is of the
opinion that in the particular circumstances it would be inequitable for the
contract to be avoided.

(4) If a person is convicted of an offence against subsection (1), the
convicting court may order the person convicted to pay to the building owner a
sum not exceeding the total amount already paid by the building owner under
the terms of the contract.

(5) The reference in subsection (4) to a person who is convicted of an offence
includes a reference to a person who, without being convicted of the offence,
is found guilty of or has pleaded guilty to the offence and the reference in
that subsection to the convicting court is to be construed accordingly.

(6) This section does not apply in relation to a cost plus contract.