Queensland Domestic Building Contracts at a glance
Queensland Domestic Building Contracts are principally regulated by Schedule 1B of the Queensland Building and Construction Commission Act 1991. Most domestic building contracts over $3,300 must be written, dated and signed. Regulated contracts below $20,000 generally attract a 10% maximum deposit; contracts of $20,000 or more generally attract a 5% maximum. Cooling-off rights, statutory warranties, written variations and payment controls protect owners, but those protections have exceptions and strict procedural requirements.
A building contract determines far more than the advertised price. It allocates responsibility for soil conditions, approvals, selections, delays, payment and unfinished work. When the relationship deteriorates, the outcome often turns on a particular notice, a missing specification or the date a defect first became apparent.
This guide explains Queensland Domestic Building Contracts from signing through to completion and disputes. It addresses contemporary contracts; older agreements require the legislation and transitional provisions applicable to their dates to be checked. The emphasis is on the decisions that change the parties’ legal position: what to put in the agreement, when money is payable, how changes must be documented, and what to do before stopping work or terminating.
Which Queensland Domestic Building Contracts are regulated
The starting point is Schedule 1B of the Queensland Building and Construction Commission Act 1991, referred to below as the QBCC Act.
Under Schedule 1B, section 3(1), a domestic building contract includes a contract to carry out domestic building work and certain contracts to manage that work. Section 4 covers construction of a detached dwelling, renovation and repair of a home, removal and resiting work, kit home installation and associated work. A duplex falls within the Schedule’s definition of detached dwelling. Associated work can include retaining structures, driveways, garages, swimming pools and services.
Classification deserves attention. Construction of a new apartment building should not simply be treated as construction of a detached dwelling. Conversely, renovation of an existing residential unit may be domestic building work because the definition of home is broader. Read section 1, section 4 and section 9 together and check the exclusions in regulation 46.
Nor does every residential project fall within Schedule 1B. Section 3(2) excludes, among other things, builder–subcontractor contracts, contracts between an owner-builder permit holder and a building contractor, and a single contract to construct two or more detached dwellings. Separate contracts for multiple dwellings can also be treated as one excluded contract under sections 3(3)–(4). These exclusions do not mean the work is free of licensing, insurance or other legal obligations.
For Queensland Domestic Building Contracts within the Schedule, section 5 identifies regulated contracts by reference to the $3,300 regulated amount in section 1. Cost plus and mixed-purpose contracts have specific tests. Section 6 and section 7 distinguish level 1 from level 2, with the $20,000 level 2 threshold prescribed by regulation 45.
| Contract category | Price threshold | General deposit ceiling | Key distinction |
| Below the regulated threshold | $3,300 or less | Schedule 1B section 33 does not set the deposit limit | A written agreement remains sensible; other laws may apply |
| Level 1 regulated contract | More than $3,300 and less than $20,000 | 10% | Written, dated and signed contract with prescribed information |
| Level 2 regulated contract | $20,000 or more | 5% | Additional contract information, Consumer Building Guide and commencement notice |
| Qualifying off-site work exception | Either regulated level, where off-site work exceeds 50% of the contract price | 20% | The exception requires the statutory factual test to be met |
The deposit rules are in Schedule 1B, section 33. The table states the general price categories; cost plus and mixed-purpose arrangements require the additional statutory calculations. Splitting one project into small contracts does not necessarily avoid regulation: section 11 aggregates separate contracts that could form a single domestic building contract.
What Queensland Domestic Building Contracts must contain
The written agreement and the correct contracting party
For level 1 contracts, Schedule 1B, section 13 requires a written, dated agreement signed by or for both parties. It must identify the parties and contractor’s licence number, describe the work, include the plans and specifications, state the price or calculation method, provide for practical completion and contain the cooling-off notice.
Level 2 requirements are more extensive. Section 14 also addresses the start date, statutory warranties, prominence of pricing information and warnings about provisions allowing the price to change. The builder must give the owner a signed copy, including plans and specifications, within five business days under section 15.
There is a significant distinction between missing information and failure to execute the agreement properly. Sections 13(5) and 14(10) expressly say the contract has effect only if it complies with the writing, dating and signing requirements in subsection (2). By contrast, section 44 generally prevents other non-compliance from automatically making the contract illegal, void or unenforceable, unless a contrary intention appears. Neither party should assume every paperwork defect produces the same result.
Before signing Queensland Domestic Building Contracts, match the legal entity in the agreement to the licence holder. A trading name is not a substitute for identifying the company or individual who promises to perform. Section 42 of the QBCC Act regulates unlicensed building work and restricts recovery for work performed unlawfully, subject to statutory qualifications. The licence class and the identity of the contracting entity matter as much as whether someone on site holds a licence.
Plans and special conditions need to agree
The agreement should identify the revision and date of every drawing and specification. Check the order of precedence where the contract schedule, drawings, tender, inclusions list and special conditions differ. A glossy display-home brochure is poor protection if the signed inclusions specify a cheaper product.
HIA, Master Builders and QBCC forms are starting points. An industry form does not make added special conditions harmless. A review should test exclusions, owner obligations, access, finance conditions, selection deadlines, margins, delay allowances, guarantees and the consequences of non-payment. Stonegate Legal’s guide to building contract reviews explains the issues that merit attention before the parties commit.
For level 2 Queensland Domestic Building Contracts, the builder must provide the Consumer Building Guide before the owner signs: Schedule 1B, section 18. Treat that document as a useful warning system, not a substitute for reading the agreement it accompanies.
Cooling off and Queensland Domestic Building Contracts
When the five business days begin
Schedule 1B, section 35(1) generally allows an owner to withdraw within five business days after receiving the signed contract from the builder. The trigger is receipt of the signed copy, rather than simply the date the owner signed.
If a level 2 owner receives the Consumer Building Guide later, section 35(2) provides a withdrawal period following receipt of that guide. Missing documents can also engage sections 35(3)–(4). Record when each document arrived, including the email and attachments.
The procedure is specific. Under section 37, the owner must give a signed written withdrawal notice stating that the owner withdraws and identifying the Schedule provision relied on. Use one of the permitted methods within time. A telephone call saying the project is cancelled is not the statutory notice.
Withdrawal is not necessarily free. Section 38 allows reasonable out-of-pocket expenses incurred before withdrawal and, where withdrawal is under section 35(1), an additional $100. The entitlement is not a general right to retain the whole deposit.
Legal advice can remove the right
Owners of Queensland Domestic Building Contracts should understand section 36(3) before relying on cooling off. The right is unavailable where, before entering the contract, the owner received formal legal advice about it. It can also be lost where the owner tells the builder, when or after signing, that such advice was received before signing.
Formal legal advice has a defined meaning: independent advice from a practising legal practitioner for which a fee is paid or payable. This does not make pre-contract advice undesirable. It means the decision to sign should be final and informed, rather than based on an assumed five-day escape route.
Other restrictions include substantially similar replacement contracts under section 36(2). Section 39 separately permits a signed waiver for qualifying repair contracts. A blanket statement that every Queensland building contract carries an unqualified cooling-off period is wrong.
Deposits and progress payments under Queensland Domestic Building Contracts
A builder cannot avoid the deposit ceiling by calling an upfront payment a procurement fee. The definition in Schedule 1B, section 33(3) includes payments for domestic building work demanded or received before contracted services start at the site.
For a $600,000 level 2 contract, the ordinary maximum deposit is $30,000. A demand for $60,000 needs a lawful basis; the fact that materials must be ordered does not itself establish the off-site work exception. That exception requires off-site work worth more than half the contract price.
After work starts, section 34(1) requires progress claims to relate directly to progress at the building site and to be proportionate to, or less than, the value of the relevant work. The section expressly excludes from its definition of building site a place where work is prepared for later installation elsewhere. A payment schedule should not leave the owner financing a substantial shortfall between money paid and value delivered.
A bank approving a drawdown does not decide whether the builder has satisfied the contractual stage. Check the stage definition, work actually done, payment due date and any dispute procedure. Equally, an owner should not withhold a genuinely due payment merely to create leverage over an unrelated complaint. That may expose the owner to contractual suspension or termination rights.
For Queensland Domestic Building Contracts, the practical discipline is straightforward: keep a running account of the original price, approved changes, payments and disputed sums. Without it, a dispute about one invoice can obscure a much larger problem with the remaining budget.
Fixed prices and allowances in Queensland Domestic Building Contracts
A fixed price still needs to be read
“Fixed price” does not necessarily mean no adjustment can ever occur. The contract may provide for agreed variations, provisional sums, prime cost adjustments or particular changes in statutory charges. The question is whether the claimed increase falls within an operative provision and complies with the law.
A builder’s increased labour or material costs do not, by themselves, create an entitlement to increase an agreed fixed price. Ask for the clause relied on, the event said to trigger it, the calculation and the supporting records. Schedule 1B, sections 14(4)–(7) require level 2 pricing information and relevant warnings to be prominently disclosed.
The Australian Consumer Law also matters. It applies as Queensland law through section 16 of the Fair Trading Act 1989. For standard form consumer contracts, ACL section 23 addresses unfair terms; section 24 requires significant imbalance, lack of reasonable necessity to protect legitimate interests, and detriment, assessed with transparency and the whole contract in mind. Section 25(1)(f) identifies certain unilateral price variation terms as potentially unfair. That example does not make every escalation clause automatically invalid.
Prime cost items are different from provisional sums
A prime cost item is an allowance for supply and delivery of an item not yet selected or not finally priced, such as an oven. A provisional sum estimates particular contracted services that cannot be definitely priced after reasonable enquiries. See Schedule 1B, section 1 and section 10.
For Queensland Domestic Building Contracts containing these allowances, section 26 warrants that they have been calculated with reasonable care and skill using the information reasonably available when the contract was entered. An artificially low allowance is not rendered reasonable merely because it appears in a signed schedule.
Real-world example — the kitchen allowance. Assume a contract allows $3,000 for appliance supply and provides a 15% margin on any excess. The owner later selects appliances costing $5,000. On those assumed terms, the adjustment is $2,000 plus $300 margin, giving $2,300 before any separate GST adjustment required by the contract. Check whether the figures are already GST-inclusive and whether installation was priced separately. This is a worked illustration, not a universal margin or pricing rule.
Cost plus Queensland Domestic Building Contracts require particular caution because the final price depends on actual costs and the agreed fee or margin. Define which expenses are recoverable, what records must be supplied, how subcontractor charges are verified and whether there is a genuine cap. Also check insurance consequences before choosing that structure; non-completion protection is not interchangeable with that under a fixed-price contract.
Foundations data can defeat a site cost claim
Under Schedule 1B, section 31, a builder generally must obtain appropriate foundations data before entering a contract involving relevant footings or slab work, subject to the statutory exceptions.
The financial consequence is substantial. Under sections 31(8)–(9), a builder who failed to obtain required data cannot seek an additional amount whose need and calculation could reasonably have been established by obtaining it. A general price adjustment clause does not, by itself, make that amount one already provided for in the contract. Section 31(10) preserves a different position where the builder complied and the need for the extra amount could not be established from the data obtained.
Real-world example — unexpected excavation. A builder signs before obtaining required soil information, then demands an extra $25,000 for footing work. The owner’s response should not stop at “the contract says fixed price”. The better enquiry is whether appropriate data would have identified the condition and allowed the cost to be calculated before signing. Expert evidence may determine that issue. If the condition could not reasonably have been established from compliant data, the outcome may differ.
Variations to Queensland Domestic Building Contracts
An owner-requested upgrade, altered engineering detail or changed layout should be dealt with while the change is being considered. Waiting until the final invoice makes agreement and price much harder to prove.
Under Schedule 1B, section 40(2), the builder must provide a written copy before the earlier of five business days after agreement and the start of variation work. Section 40(5) prohibits starting that work before the owner agrees in writing. The urgent-work defence in section 40(4) is specifically a defence to a contravention of subsection (2); it should not be treated as a general exemption from every variation requirement.
Section 41(2) requires the document to describe the variation, record the request date, state a reasonable estimate of relevant delay, and identify the price change or calculation method and when it is accounted for. Under section 41(3), an increased price cannot be required to be paid before the variation work starts.
For disputed variations to Queensland Domestic Building Contracts, distinguish regulatory non-compliance from the separate question of civil recovery. It is unsafe to promise either that every undocumented variation is payable or that every such variation is automatically free. The contract, evidence of agreement, statutory provisions and the legal basis of the claim all require analysis. Stonegate Legal’s guide to variations in Queensland building contracts examines those disputes in greater detail.
Delays and completion dates in Queensland Domestic Building Contracts
For level 2 work, Schedule 1B, section 16 requires a signed commencement notice within ten business days after work starts at the site, stating the start date and practical completion date. Keep it with the original contract and every extension request.
Section 42(1) sets substantive and procedural requirements for extensions of time. The relevant delay must be unforeseeable and beyond the builder’s reasonable control, caused by the owner, or caused by a variation complying with section 40. The claim must be written, given within ten business days of actual or constructive awareness of the cause and extent of delay, and approved by the owner in writing. The builder must then give the owner a signed copy within five business days of approval under section 42(3).
A claim for rain should therefore identify the affected work and explain why the event meets the applicable test. A generic assertion that there has been bad weather does not resolve entitlement or the number of days. Owners should assess requests promptly against the programme and evidence rather than rejecting them reflexively.
Queensland Domestic Building Contracts may provide liquidated damages for late completion. Check the rate, trigger, adjusted completion date and any contractual claim procedure. If no useful rate is provided, do not assume all delay losses disappear: the availability of other damages depends on the contract and proof. Stonegate Legal’s guide to delays in Queensland construction contracts explains the timing and evidentiary issues.
Practical completion and defective work
Handover is a legal milestone
The definition of practical completion in Schedule 1B, section 1 requires compliance with the contract, plans, specifications and applicable statutory requirements. It permits only minor defects or omissions that do not unreasonably affect occupation. Where the owner claims minor items, the builder must provide a defects document meeting the statutory definition.
That document records agreed minor defects and omissions, rectification timing and items the owner claims but the builder disputes. Practical completion is therefore not an assertion the builder can establish simply by issuing an invoice. Nor can an owner necessarily prevent it because every cosmetic item has not been corrected.
Under Queensland Domestic Building Contracts, inspect before handover and distinguish incomplete work, major defects and minor defects. Ask for the required certificates. Where the builder engages the certifier, section 17 requires copies of inspection certificates as soon as practicable after receipt, subject to its defence. Certification and contractual quality are different enquiries; an inspection certificate does not decide every workmanship complaint.
Statutory warranties are part of the bargain
Schedule 1B, section 19 incorporates statutory warranties into regulated contracts. They do not depend on the builder volunteering a written guarantee.
| Warranty | Main protection | Provision in Schedule 1B |
| Materials | Good and suitable materials, generally new unless otherwise stated; statutory qualifications apply | Section 20 |
| Legal compliance | Work complies with relevant laws and legal requirements | Section 21 |
| Workmanship | Appropriate and skilful work with reasonable care and skill | Section 22 |
| Plans and specifications | Compliance where they form part of the contract | Section 23 |
| Occupation | Suitability for occupation where the qualifying work is intended to reach that stage | Section 24 |
| Diligence | Work carried out with reasonable diligence | Section 25 |
| Allowances | Reasonable care and skill in calculating prime cost items and provisional sums | Section 26 |
Section 28 makes provisions purporting to restrict or remove warranty rights void. Certain warranty rights also pass to subsequent owners under section 27, subject to its knowledge and existing-rights limitations. A later purchase does not restart the warranty period.
Owners assessing Queensland Domestic Building Contracts should avoid assuming that a short contractual defects liability period extinguishes all statutory rights. Stonegate Legal’s guide to statutory warranties for residential building work in Queensland explains the separate protections and their limits.
Consumer guarantees can provide an additional basis for relief. Where the owner acquires services as a consumer, ACL section 60 requires due care and skill; section 61 addresses fitness for a disclosed purpose, subject to its qualifications; and section 62 addresses a reasonable completion time where no time is fixed or agreed. Section 64 prevents contractual exclusion of these guarantees. These rights need their own analysis rather than being assumed to have the same scope and deadlines as Schedule 1B warranties.
Refusing rectification access can damage the claim
Under Schedule 1B, section 29(6)(b), it is a defence to statutory warranty proceedings to prove that the defendant was not reasonably given access to rectify the deficiencies complained of. This deserves attention before an owner changes locks or tells the builder never to return.
That does not require accepting every proposed repair regardless of its adequacy or safety. Record the defects, obtain technical advice, request a defined rectification method and propose reasonable access arrangements. If access is refused, keep evidence of the reason. For builders, a vague offer to “sort it out” is less useful than a properly documented proposal addressing the actual defects.
Case example one — Bellgrove v Eldridge
In Bellgrove v Eldridge [1954] HCA 36; (1954) 90 CLR 613, serious departures from the specifications left a house with defective foundations and unstable construction. The High Court upheld damages assessed on demolition and rebuilding because that response was necessary and reasonable to obtain conformity with the contract. The discussion at 617–618 remains central to rectification damages.
The decision does not establish that any defect justifies replacing the whole house. The owner must justify the proposed rectification. For Queensland Domestic Building Contracts, that makes expert evidence about the cause, repair method and reasonable cost more useful than a bare quote for the most extensive available works. Although the dispute arose in Victoria, the High Court’s contractual damages principles have national significance.
Warranty deadlines and home warranty insurance
Proceedings must start within the applicable period
Schedule 1B, section 29(3) provides a six-year warranty period for a breach resulting in a structural defect and one year in other cases. The period starts on completion or, for unfinished work, by reference to termination, cessation or the contract date in the circumstances specified in that subsection.
Under section 29(2), where the breach becomes apparent within the final six months of the warranty period, proceedings may be started within a further six months after the period ends. Section 29(4) includes what the person ought reasonably to have known, not just what they actually noticed.
A complaint letter is not the commencement of proceedings. Do not assume negotiations or a QBCC complaint stop the warranty clock. Other causes of action can have different periods: for example, section 10(1)(a) of the Limitation of Actions Act 1974 generally prescribes six years from accrual for a simple contract action. That does not convert every expired statutory warranty claim into a viable contract claim. Identify the particular obligation, when it was breached and the correct forum.
Insurance operates under separate rules
The Queensland Home Warranty Scheme is not simply an extension of the builder’s contractual warranty. Its statutory framework is in Part 5 of the QBCC Act and Schedule 6 of the QBCC Regulation. Eligibility, exclusions, financial limits and claim deadlines must be checked separately.
For defective work, Schedule 6, section 16 distinguishes structural and other defects. Non-structural defects generally must become apparent within six months after substantial completion, with a claim within seven months. Structural claims have their own cover period, generally linked to cover commencement, and a three-month claim deadline following actual or constructive awareness; an extended period can apply where construction takes longer than six months. Do not calculate that period solely from handover without checking the provision.
For non-completion, check Schedule 6, section 3, section 4, section 5, section 6 and section 7 and the QBCC’s current non-completion insurance guidance. For work not started, the contract must end within two years after entry; for work started, within two years after work starts. A claim must be made before the day that is three months after the contract ends. The definition of when a contract ends is specific, and further eligibility requirements apply. Cost plus work requires particular attention because this protection requires a qualifying fixed price residential contract.
For Queensland Domestic Building Contracts, three separate diary entries may be needed: the proceedings deadline, the QBCC rectification deadline and the insurance claim deadline. Treating them as one date can lose an otherwise valuable remedy.
Suspension and termination of Queensland Domestic Building Contracts
Termination is often the point at which a manageable dispute becomes substantial litigation. An owner who wrongly excludes the builder may face an allegation of repudiation. A builder who stops work without an available right may commit a serious breach of its own.
Begin with the contract. Identify the default, whether the clause requires a notice to remedy, the cure period, permitted service methods and any separate termination notice. Then consider whether a common law right exists. A disagreement about workmanship does not automatically justify immediate termination, and a late invoice does not automatically permit immediate suspension.
Owners should preserve the site condition, obtain a completion and defects assessment, reconcile payments and investigate insurance before appointing a replacement contractor. Builders should establish the contractual basis and amount of a payment default before relying on it. Stonegate Legal’s guide to terminating a residential building contract in Queensland examines those steps and the consequences of getting them wrong.
A demand for payment does not necessarily entitle the builder to secure the debt over the owner’s home. Schedule 1B, section 43 prevents a domestic building contract from giving the builder the specified interest in a resident owner’s land and prohibits a caveat claimed under that contract with knowledge of that status. Investor and other arrangements require separate analysis.
A QBCC complaint is not itself termination. The QBCC expressly warns that failure to terminate properly can affect non-completion insurance eligibility. Where insolvency is involved, seek advice on the particular insolvency event and contractual provisions rather than assuming the contract has ended automatically.
Case example two — Mann v Paterson Constructions
In Mann v Paterson Constructions Pty Ltd [2019] HCA 32, owners repudiated a Victorian domestic building contract and the builder accepted that repudiation. The dispute concerned payment for work, including orally requested variations, after termination.
The High Court rejected the proposition that termination allowed an unrestricted reasonable-value claim. For completed stages with accrued payment rights, recovery lay in the contract and damages. A majority permitted restitution for certain incomplete-stage work, with recovery in that case limited by the relevant contract price. The Court also held that the applicable Victorian variation statute could not be bypassed through restitution.
The relevant lesson for Queensland Domestic Building Contracts is that termination does not erase agreed prices and accrued rights. The Victorian statutory variation ruling must not be presented as a ruling on Queensland’s differently worded legislation. The High Court’s official judgment summary explains the distinction between completed and incomplete stages; the linked judgment supplies the reasons.
Resolving disputes about Queensland Domestic Building Contracts
QBCC complaints and QCAT proceedings have different functions
The QBCC’s regulatory and dispute processes should be distinguished from an adjudicated damages claim. Under section 77(2) of the QBCC Act, a person must comply with the Commission’s dispute resolution process before applying to QCAT to decide a building dispute. QCAT’s current guidance requires the relevant QBCC outcome letter, or a letter advising that no process is required, with the application. Failure to provide it can result in refusal or dismissal.
QCAT can hear domestic building disputes of any monetary amount; the commercial building jurisdiction is different. Section 77(3) gives powers including payment orders, damages and orders for rectification or completion. A decision about forum should also account for the parties, relief sought and any jurisdictional complication. Stonegate Legal’s guide to QCAT building disputes in Queensland explains the pathway in more detail.
Representation and costs require separate planning. Section 43 of the Queensland Civil and Administrative Tribunal Act 2009 regulates representation and the circumstances requiring leave. Section 100 states the usual position that each party bears its own costs, subject to the Act or enabling legislation. Section 102 permits costs in the interests of justice. Neither “the winner gets all costs” nor “QCAT can never award costs” is a sound assumption.
Security of payment does not apply identically to every owner
The rapid payment and adjudication regime in Chapter 3 of the Building Industry Fairness (Security of Payment) Act 2017 has an express resident-owner exclusion in section 61(2)(b), subject to its scope and the definition in subsection (5).
An owner-occupier’s home contract should therefore not automatically be treated like an investor’s project or a builder–subcontractor agreement. Conversely, “residential work” is not a universal exemption. Establish who contracted and whether the statutory exclusion applies before deciding that a payment claim can be ignored.
Build the evidence around the disputed obligations
For Queensland Domestic Building Contracts, a useful dispute file includes the executed agreement, every incorporated drawing, variations, notices, payment records, dated photographs, inspection documents, emails and expert reports. Preserve original electronic records and attachments. A screenshot that omits the preceding exchange can conceal the very qualification on which the dispute turns.
A defect report should identify the contractual or technical requirement, the departure, its cause, the proposed remedy and the cost. A delay claim needs dates and causation. A completion claim needs a reliable assessment of what remains to be done and the unpaid contract balance. These are different enquiries, and the evidence should reflect that.
Where a court claim is appropriate, identify the actual contractual terms and alleged conversations rather than pleading that the builder merely “promised a good job”. Stonegate Legal’s guide to pleading contracts and conversations in Queensland explains why those particulars matter. The same factual discipline helps prepare a coherent QCAT application, although court pleading rules should not be assumed to govern the tribunal in the same way.
Before spending heavily on proceedings, compare the likely recovery with expert costs, legal costs, the unpaid contract balance and the respondent’s ability to satisfy an order. A technically strong defects claim against an insolvent company may require an insurance strategy as urgently as a litigation strategy.
Before you sign or take the next step
A careful review of Queensland Domestic Building Contracts should answer practical questions: who owes the obligations, precisely what work is included, how much can change, when payments fall due and which notices preserve the parties’ rights. If the work is already disputed, identify the earliest potentially applicable deadline before negotiating the merits.
Do not sign an incomplete specification on the assumption that selections will be settled later without consequence. Do not approve an unexplained variation simply to keep the project moving. And do not terminate on the strength of frustration alone. Those are the decisions most likely to change the cost and direction of the dispute.
This guide provides general information about Queensland law. Advice on a particular contract requires the full document set, relevant dates and evidence of what has occurred.
Frequently asked questions about Queensland Domestic Building Contracts
What laws govern Queensland Domestic Building Contracts?
Queensland Domestic Building Contracts are principally governed by Schedule 1B of the Queensland Building and Construction Commission Act 1991. It regulates contract requirements, deposits, progress payments, cooling-off rights, variations and statutory warranties. Other laws, including the Australian Consumer Law, may provide additional protection. The applicable rules depend on the work, contract value and parties involved.
Do domestic building contracts in Queensland have to be in writing?
A regulated domestic building contract over $3,300 must be written, dated and signed by or on behalf of both parties. It must also contain prescribed information, including the contractor’s identity and licence number, work description, plans, specifications, pricing and practical completion provisions. These requirements appear in Schedule 1B, sections 13 and 14. A written agreement remains advisable for smaller projects.
What is the difference between level 1 and level 2 building contracts in Queensland?
Level 1 contracts cover regulated domestic building work priced above $3,300 but below $20,000. Level 2 contracts generally cover work priced at $20,000 or more. Level 2 contracts have additional requirements, including more detailed contract information, provision of the Consumer Building Guide before signing and a commencement notice. Cost plus and mixed-purpose contracts require the relevant statutory calculations.
How much deposit can a builder charge in Queensland?
The usual maximum deposit is 10% for a level 1 regulated contract and 5% for a level 2 regulated contract. A maximum of 20% applies where off-site work exceeds 50% of the contract price. For example, the ordinary deposit ceiling on a $600,000 level 2 contract is $30,000. Ordering materials does not, by itself, establish the off-site work exception.
Is there a cooling-off period for Queensland Domestic Building Contracts?
Owners generally have five business days to withdraw after receiving a signed copy of a regulated domestic building contract from the builder. Additional rules apply where a level 2 owner receives the Consumer Building Guide later. Withdrawal requires a signed written notice that complies with the legislation. Exceptions apply, and the builder may recover permitted expenses and, in some circumstances, $100.
Does getting legal advice remove the cooling-off period?
Receiving paid independent legal advice about the contract before signing can remove the statutory cooling-off right. Under Schedule 1B, section 36, the restriction also applies where the owner tells the builder that qualifying advice was received before signing. Owners should therefore resolve outstanding concerns before executing the contract rather than assuming they can withdraw afterwards.
Can a builder increase the price of a fixed-price building contract?
A builder cannot increase a fixed contract price merely because its costs have risen. An increase needs a valid contractual or other legal basis, such as an agreed variation or an adjustment permitted by an enforceable clause. Check the clause, triggering event, calculation and supporting documents. Foundations data obligations and unfair contract terms laws may also affect whether the increase is recoverable.
What is the difference between a prime cost item and a provisional sum?
A prime cost item allows for supplying and delivering an item not finally selected or priced; a provisional sum estimates particular work that cannot be definitely priced after reasonable enquiries. An appliance allowance may be a prime cost item, while uncertain excavation work may attract a provisional sum. Both allowances must be calculated with reasonable care and skill. Check how margins and GST affect adjustments.
Do building contract variations have to be approved in writing?
For regulated Queensland Domestic Building Contracts, the builder must obtain the owner’s written agreement before starting variation work. The variation document must address the changed work, price adjustment and relevant delay, together with other prescribed information. An undocumented variation can create regulatory and recovery disputes. It is unsafe to assume that every verbal variation is automatically payable—or automatically free.
When can a builder claim an extension of time in Queensland?
A builder must satisfy statutory grounds and procedural requirements before relying on an extension of time under a regulated contract. Under Schedule 1B, section 42, the grounds include qualifying unforeseen delays beyond the builder’s reasonable control, owner-caused delays and compliant variations. Claims must be written, submitted within the prescribed ten-business-day period and approved by the owner in writing.
What does practical completion mean under a Queensland building contract?
Practical completion generally means the work complies with the contract and applicable statutory requirements, apart from minor defects or omissions that do not unreasonably affect occupation. Where the owner claims minor defects or omissions, the builder must provide the required defects document. Issuing a final invoice does not itself establish practical completion, while minor cosmetic defects do not necessarily prevent it.
How long do statutory building warranties last in Queensland?
The statutory warranty period is generally six years for a breach resulting in a structural defect and one year for other breaches. The starting date depends on whether the work was completed, terminated, ceased or never started. A limited six-month extension applies where the breach becomes apparent in the final six months. These are proceedings deadlines, separate from insurance and QBCC complaint deadlines.
Do I have to let the builder return to fix defective work?
Refusing reasonable access to rectify defects can undermine a statutory warranty claim. Schedule 1B, section 29(6)(b) provides a defence where the defendant was not reasonably given access to rectify the deficiencies complained of. Owners should document defects, request an appropriate repair proposal and consider reasonable access arrangements. Safety concerns and inadequate repair methods should be assessed and recorded.
Can I terminate a Queensland domestic building contract for delays or defective work?
Delays or defective work may justify termination, but they do not automatically create an immediate right to end the contract. The contract may require a notice identifying the breach and allowing time to remedy it. Wrongful termination can expose the terminating party to a damages claim and affect insurance eligibility. Obtain advice before excluding the builder, appointing a replacement or issuing a termination notice.
How do I resolve a domestic building contract dispute in Queensland?
Start by documenting the dispute, identifying the relevant contract terms and checking all applicable deadlines. Before applying to QCAT, parties generally must complete the required QBCC dispute process and provide the appropriate QBCC letter. QCAT can hear domestic building disputes without a monetary ceiling, subject to its jurisdiction. Depending on the circumstances, remedies may include payment, damages, rectification or completion orders.
