Last updated: 10 March 2017
You can protect your consumer rights during a build by asking your building contractor for a disclosure statement and following the standard checklist to tick off the contract essentials.
Essential disclosure and checklist requirements
Your builder must provide this information if you ask for it, regardless of the size of the work. If your building work is going to cost $30,000 or more (including GST) they must provide it anyway. If they don't supply this information the builder can be fined.
A building contractor is a person or company you have asked to do your building work. They might be a builder, plumber, electrician or any other tradesperson you are dealing with directly. If your contractor hires other workers to help complete your building work they do not need to provide a disclosure statement (for example subcontractors).
It's important to clarify roles and responsibilities for your building work at the start of the project, when getting quotes and before signing your contract. For example, the homeowner is responsible for obtaining any required building or resource consents, even if they ask their builder or project manager to actually make the application.
Disclosure statement contents
By law, the contractor must give you a disclosure statement that includes:
- their name and/or the legal name of their business entity
- whether they are trading as an individual, partnership or Limited Liability Company
- their business address and contact details and when the business was formed
- information about the key contact person (for example, the project manager or site foreman) who will be involved in carrying out or supervising the building work, including their relevant qualifications, skills and experience
- information about insurance policies the contractor has, or intends to have, in relation to the building work – they must specify the amount of the cover and any relevant exclusions on policy coverage
- information about any guarantees or warranties the contractor offers in relation to the building work – they must specify the time period the guarantee or warranty is offered for and any limits or exclusions on coverage.
If any of the information in the disclosure statement seems unusual, query it with the contractor. Anyone who knowingly provides false or misleading information, or who knowingly leaves out information, is liable on conviction to a fine of up to $20,000.
Tick off the checklist
The standard checklist includes information about:
- managing building projects
- hiring contractors
- essentials in a written contract
- ways to protect yourself, including:
- becoming informed
- agreeing on project structure and management
- hiring competent building contractors
- agreeing on price and payments
- having a written contract
- taking control
- resolving disputes.
If you are the main contractor you can give your disclosure statement and this checklist to your client (print or email). You must not make any changes to the checklist – you cannot add your business logo or contact details.
If you have been hired by the main contractor, you do not need to provide this to anyone, no matter the value of the building work.
Homeowners can find relevant information by downloading Building or renovating? Know your rights
Building professionals can find relevant information by downloading Contractors: Do your homework
What to do when things go wrong
It’s important you address any problems as quickly as possible. It might simply be that you need clarification about something. Or there might be a bigger problem.
Talk to your builder, your designer or your council.
Resolving problems might be useful if you need to look at alternatives.