WHEN YOU NEED A CONTRACT
Whether you’re building a house for a homeowner, or working in the commercial sector on high rises, you need a contract between yourself and your client or subcontractor. This includes head contracts, subcontracts and sub-subcontracts (i.e. contracts between subcontractors).
If any of your jobs involve domestic building work priced at over $3,300, you need to use a written contract. If the work is over $20,000, you must also ensure your client is given a signed copy of a QBCC-approved Consumer Building Guide.
What is domestic building work?
Examples of domestic building work include:
- building a new detached dwelling (including a duplex)
- building a structure associated with a home such as a shed, garage, carport, retaining structure, driveway, fence, workshop, swimming pool or spa
- removing or re-siting a dwelling intended to be used as a residence
- renovating, extending, altering, improving (including painting and installing services) or repairing a home, duplex or unit
- refitting a kitchen or bathroom, and
- landscaping, paving, site work, etc.
Retention monies in contracts
Retention monies in construction contracts will no longer be limited to the usual five per cent of the contract price, if a ‘special-purpose vehicle’ is one of the contracted parties.
A special-purpose vehicle is an entity established to carry out a public-private partnership, and is declared by the Queensland Treasurer by gazette notice.
These recent amendments to the QBCC Act don’t affect standard subcontracting arrangements between principal contractors and subcontractors, in which retention monies under subcontracts remain limited to 5 per cent of the contract price, and the parties cannot contract out of this provision.
Which contract to use?
You have a few choices. You can use one of our contracts, which covers most situations and has the added benefit of being compliant with the legislation. Alternatively, you can use a contract developed by an industry association but you must check that it complies with current laws. If you opt to use an interstate contract, be aware that they don’t usually meet requirements under our legislation.
A warning about using your own contract
If you want to use your own written agreement, it’s essential you get legal advice first. You risk prosecution, fines, or financial loss if you go ahead without making sure that it complies with the Queensland legislation.
Consumer Building Guide
You must give your client a copy of the Consumer Building Guide to read and sign before you sign a contract. It provides general information to help them understand their rights and obligations.
Before you sign a contract
Read our helpful guide Domestic Building Contracts – General information for owners and contractors (PDF). It contains general information about domestic building contracts and the relevant Queensland legislation.
- New Home Construction Contract (PDF) for the construction of an entire home
- Level 1 – Renovation, Extension and Repair Contract (PDF) for renovations, extensions and routine repairs on existing homes for contracts $3,301 to $19,999
- Level 2 – Renovation, Extension and Repair Contract (PDF) for renovations, extensions and routine repairs on existing homes for contracts $20,000 and over
- Natural Disaster Repairs Contract (PDF) designed to help you organise repairs to a home, duplex or home unit after a natural disaster
- Consumer Building Guide (PDF)
- Demolition Contract (PDF)
- Small Building Projects Contract (PDF)
As a consequence of the Treasury Laws Amendment (2017 Enterprise Incentives No. 2) Act 2017 (Cth) (“the Act”) which comes into effect as of 1 July, 2018, QBCC has amended all of its domestic building contracts, being the New Home Construction Contract‘ the Level 1 & Level 2 Renovation, Extension & Repair Contracts and the Natural Disaster Repairs Contract to better address a party’s right to terminate the contract for reasons related to the insolvency of the other party to the contract.
As the Act applies to all contracts entered after 1 July, 2018 QBCC is concerned to ensure any person entering a contract after that date uses the updated version of the Contract, to avoid certain existing clauses being deemed to be unenforceable by the Act. If you currently have a copy of the current version of the above QBCC contracts and will not enter the relevant contract prior to 1 July, 2018, please discard the current contract and download an updated version listed above.
Consumers are reminded that the termination of any contract is a significant step which should not be taken without prior legal advice from an experienced lawyer.