Home Building Contracts (Home Indemnity Insurance Exemptions) Regulations 2002 (WA)
Western Australia
Home Building Contracts Act 1991
Western Australia
Western Australia
Home Building Contracts Act 1991Home Building Contracts Act 1991
These regulations may be cited as the
These regulations come into operation on the day after the day on which they are published in the
(1) In these regulations —
(a) below the finished ground level; or
(b) if part of the external wall of that part of the building is on the boundary of the allotment — below the natural ground level at that part of the external wall;
(a) a residential building work contract; or
(b) a cost plus contract that would be a residential building work contract but for the definition of “residential building work contract” in the Act;
(a) for whom residential building work is to be performed under the contract; and
(b) who carries on business selling, leasing or otherwise dealing in dwelling units of multi‑storey multi‑unit developments with a view to making a profit or capital gain;
(a) a policy of insurance that complies with Part 3A Division 2 of the Act; or
(b) corresponding cover;
(a) has a rise in storeys of more than 3; or
(b) has more than one basement storey;
(2) For the purposes of the definition of “multi‑storey multi‑unit development”, a building that is attached to another building is not to be regarded as part of that other building unless it is structurally reliant upon that other building.
(1) Residential building work for or in respect of a multi‑storey multi‑unit development for which a building permit is to be granted is exempt from the requirements of Part 3A of the Act if, for each building contract or sale contract in respect of the building work that —
(a) the builder has entered into before the building permit is to be granted; and
(b) is in force at that time,
the builder has given a notice in the form set out in Schedule 1 Form 1 to the other party to the contract.
(2) If the builder does not give the notice to the other party to the contract before the contract is entered into and the other party is not a developer of the development, the other party (the
purchaser ) may rescind the contract.(3) To rescind the contract, the purchaser must give notice of the exercise of the right to rescind to the builder, before the earlier of —
(a) the expiration of one month after the day on which the notice referred to in subregulation (1) is received by the purchaser; or
(b) settlement.
(1) This regulation applies to residential building work for or in respect of a multi‑storey multi‑unit development if —
(a) a building permit for the work is to be granted; and
(b) at the time the building permit is to be granted, there is to be in force —
(i) no building contract relating to the work; and
(ii) no sale contract relating to the development to which the builder is a party.
(2) The residential building work is exempt from the requirements of Part 3A of the Act.
(1A) In this regulation —
(1) The exemption under regulation 4 or 5 of particular residential building work ceases if, before entering into a building contract or sale contract in respect of the building work after the building permit for the building work is granted, the builder does not give a notice in the form set out in Schedule 1 Form 1 to the other party to the contract.
(2A) A former exemption of particular residential building work ceases if, before entering into a building contract or sale contract in respect of the building work after a building licence for the building work was issued, the builder does not give a notice in the form set out in Schedule 1 Form 1 to the other party to the contract.
(2) Residential building work that is not exempt from Part 3A of the Act because of subregulation (1) or (2A) becomes exempt again when the builder has given a notice in the form set out in Schedule 1 Form 1 to the other party to each contract referred to in subregulation (1) or (2A) for which the builder did not give such a notice before entering into the contract.
(3) If the party to a contract referred to in subregulation (2) is not a developer of the development, the party (the
purchaser ) may rescind the contract.(4) To rescind the contract, the purchaser must give notice of the exercise of the right to rescind to the builder, before the earlier of —
(a) the expiration of one month after the day on which the notice referred to in subregulation (1) or (2A) is received by the purchaser; or
(b) settlement.
(1) This regulation applies to a developer of a multi‑storey multi‑unit development who is given a notice under regulation 4(1), or 6(1), (2A) or (2) (the
builder’s notice ).(2) After receiving the builder’s notice, the developer must —
(a) before entering into a sale contract in respect of the development, give a copy of the builder’s notice to the other party to the sale contract (the
purchaser ) if settlement is to occur within 6 years of practical completion of the building work in respect of which the builder’s notice was given; and(b) give a copy of the builder’s notice to each person (each
purchaser ) with whom the developer has already entered into a sale contract in respect of the development, within 10 days after the day on which the developer received the builder’s notice.
Penalty for this subregulation: a fine of $5 000.
(3) If the developer fails to comply with subregulation (2)(a) the purchaser may rescind the sale contract.
(4) A purchaser referred to in subregulation (2)(b) may rescind the sale contract unless the developer gave the purchaser a notice in the form set out in Schedule 1 Form 2 before the purchaser and the developer entered into the sale contract.
(5) A purchaser who may rescind a sale contract under subregulation (4) may not do so until the purchaser has received the copy of the builder’s notice referred to in subregulation (2)(b) or the 10 days referred to in subregulation (2)(b) have elapsed.
(6) To rescind a sale contract, a purchaser must give notice of the exercise of the right to rescind to the developer, before the earlier of —
(a) the expiration of one month after the day upon which the purchaser received the copy of the builder’s notice; or
(b) settlement.
(1) This regulation applies to a person, other than a developer, who is given a notice under regulation 4(1), or 6(1), (2A) or (2) (the
builder’s notice ).(2) After receiving the builder’s notice, the person must, before entering into a sale contract in respect of the building work, give a copy of the builder’s notice to the party to the sale contract if settlement is to occur within 6 years of practical completion of the building work in respect of which the builder’s notice was given.
A purchaser may give notice of the exercise of the right to rescind to the builder or developer in the form set out at the end of Schedule 1 Form 1.
(1) Residential building work that relates to the construction of a retirement village is exempt from the requirements of Part 3A of the Act if —
(a) the owner of the retirement village intends the retirement village to be a leased retirement village; and
(b) before a building permit for the residential building work is granted —
(i) the owner has lodged with the Registrar of Titles a memorial to the effect that there is no home indemnity insurance in respect of the dwellings in the retirement village; and
(ii) a statutory declaration by the owner that complies with subregulation (2) has been given to the permit authority that is to grant the building permit.
(2) In the statutory declaration referred to in subregulation (1)(b)(ii) the owner must verify that —
(a) the owner intends the retirement village to be a leased retirement village; and
(b) the owner has lodged a memorial with the Registrar of Titles in accordance with this regulation.
(3) A permit authority may rely upon a statutory declaration referred to in subregulation (2) as proof that the memorial has been lodged.
(4) A memorial under subregulation (1)(b)(i) is to be in a form approved by the Registrar of Titles.
(5) The Registrar of Titles must, on payment of the appropriate fee, register the memorial against the relevant land.
(6) The Registrar of Titles may cancel the registration of the memorial after 6 years from the day of practical completion of the leased retirement village.
(7) This regulation does not apply to residential building work for which a building permit has been granted before this regulation commences.
(1) If residential building work for a retirement village was exempt from the requirements of Part 3A of the Act under regulation 9(1), whether before or after the commencement day as defined in regulation 6(1A), the owner of the retirement village must not enter into a sale contract for one or more dwellings in the retirement village, within 6 years of the day of practical completion, unless —
(a) a policy of insurance that complies with subregulation (2) is in force in relation to the residential building work or corresponding cover that complies with subregulation (3) is provided in relation to the residential building work; and
(b) the purchaser has been given a certificate, in a form approved by the Minister, which evidences the taking out of the policy or the provision of the corresponding cover.
Penalty for this subregulation: a fine of $5 000.
(2) The policy of insurance referred to in subregulation (1)(a) complies with this subregulation if —
(a) it insures the purchaser and the purchaser’s successors in title against the risk of being unable to take advantage of an entitlement to, or to enforce or recover under, a building remedy order as defined in the
Building Services (Complaint Resolution and Administration) Act 2011 section 3 by reason of the insolvency or death of the builder who carried out the residential building work or by reason of the fact that, after due search and enquiry, that builder cannot be found;(b) it provides that claims may be made under it at any time before the expiration of a period of 6 years from the day of practical completion;
(c) it provides for insurance cover of —
(i) at least $100 000 or such other amount as is prescribed; or
(ii) the cost of the building work,
whichever is the lesser; and
(d) it is issued by or on behalf of an insurer who is —
(i) authorised under the
Insurance Act 1973 of the Commonwealth to carry on insurance business; and(ii) approved in writing by the Minister.
(3) The corresponding cover referred to in subregulation (1)(a) complies with this subregulation if the cover is provided by an approved fund and the purchaser, and the purchaser’s successors in title, are in the same position that they would be if a policy of insurance that complies with subregulation (2) were in force in relation to the residential building work.
(1) Subject to subregulation (2), residential building work carried out by or on behalf of the Housing Authority which relates to a dwelling for letting or leasing is exempt from the requirements of Part 3A of the Act.
(2) The Housing Authority must not enter into a sale contract for the dwelling referred to in subregulation (1), within 6 years from the day of practical completion, unless —
(a) a policy of insurance that complies with subregulation (3) is in force in relation to the residential building work or corresponding cover that complies with subregulation (5) is provided in relation to the residential building work; and
(b) the purchaser has been given a certificate, in a form approved by the Minister, which evidences the taking out of that policy.
(3) The policy of insurance referred to in subregulation (2)(a) complies with this subregulation if —
(a) it insures the purchaser and the purchaser’s successors in title against the risk of being unable to take advantage of an entitlement to, or to enforce or recover under, a building remedy order as defined in the
Building Services (Complaint Resolution and Administration) Act 2011 section 3 by reason of the insolvency or death of the builder who carried out the residential building work or by reason of the fact that, after due search and enquiry, that builder cannot be found;(b) it provides that claims may be made under it at any time before the expiration of a period of 6 years from the day of practical completion;
(c) it provides for insurance cover of —
(i) at least $100 000 or such other amount as is prescribed; or
(ii) the cost of the building work,
whichever is the lesser; and
(d) it is issued by or on behalf of an insurer who is —
(i) authorised under the
Insurance Act 1973 of the Commonwealth to carry on insurance business; and(ii) approved in writing by the Minister.
(4) Where the policy of insurance referred to in subregulation (2) relates to work described in paragraph (b) of the definition of “home building work” in section 3 of the Act, the cost of the building work for the purposes of subregulation (3)(c)(ii) is only the cost of —
(a) placing the dwelling on the land including siting, stumping and any other work in connection with that placement; and
(b) any building work to the dwelling after placement.
(5) The corresponding cover referred to in subregulation (2)(a) complies with this subregulation if the cover is provided by an approved fund and the purchaser, and the purchaser’s successors in title, are in the same position that they would be if a policy of insurance that complies with subregulation (3) were in force in relation to the residential building work.
[(6) deleted]
In this Part —
(a) if the building is to be constructed under a residential building work contract — an owner in relation to the contract; and
(b) otherwise — an owner of the land on which the building is to be constructed;
(a) a policy of insurance that complies with section 25D or 25G of the Act; or
(b) corresponding cover;
(1) Residential building work that relates to the construction of a class 1b building or a class 3 building is exempt from the requirements of Part 3A of the Act if —
(a) the building owner intends the building to be used as an SDA building; and
(b) before a building permit for the residential building work is issued, the building owner gives to the permit authority that is to grant the building permit a statutory declaration by the building owner to the effect that the building owner intends the building to be used as an SDA building.
(2) This regulation does not apply to residential building work in respect of which application is made for a building permit before the day on which the
Home Building Contracts (Home Indemnity Insurance Exemptions) Amendment Regulations 2024 regulation 3 comes into operation.
(1) This regulation applies if a building owner in relation to an exempt building makes a statutory declaration referred to in regulation 13(1)(b).
(2) The building owner must ensure that, within the period of 12 months from the day of practical completion, an application is made under the
National Disability Insurance Scheme (Specialist Disability Accommodation) Rules 2020 (Commonwealth) section 25 to enrol the exempt building as an SDA building.
Penalty for this subregulation: a fine of $5 000.
(3) It is a defence to a charge under subregulation (2) to prove that the person charged has a reasonable excuse that arises out of events —
(a) that occur after the making of the statutory declaration; and
(b) that the person charged could not reasonably have foreseen, avoided or anticipated.
(1) In this regulation —
(a) if the exempt work is work to which Part 3A Division 2 of the Act applies — the period of 6 years from the day of practical completion of the work; and
(b) if the exempt work is work to which Part 3A Division 3 of the Act applies — the period of 7 years from the date of grant of the building permit for the work.
(2) A person must not, within the relevant period, enter into a contract to sell an exempt building or any part of it unless the person has notified the purchaser in writing that HII cover is not in force in respect of the exempt building.
Penalty for this subregulation: a fine of $5 000.
[r. 4(1), 6(1) and (2)]
1. This notice is about ..........................................................................
..........................................................................................................
[
2. The
3. Generally, home indemnity insurance covers the person for whom the builder is doing the work against financial loss if the builder is unable to complete the work or meet a valid claim for faulty workmanship because the builder has died, disappeared or become insolvent. The insurance also covers any other person obtaining the property from that person. In most cases the insurance policy must cover the construction period and the 6 years after practical completion of the building work.
4. Residential building work done under a cost plus contract is usually only insured for faulty workmanship.
5. Building work on multi‑storey multi‑unit developments is exempt from the requirement for the builder to take out home indemnity insurance, provided that the builder gives this notice in accordance with the
6. A person who receives this notice from the builder is required by the regulations to give a copy of it to any person who intends to purchase a unit in the development from that person, before they enter into a contract for the sale of the unit.
7. You have been given this notice, or a copy of it, because you may enter into a contract, or have a contract, with the person who gave you the notice. It is to notify you that the builder who is doing, or has done, the building work has not taken out home indemnity insurance for the building work.
8. That means that the person for whom the builder is doing, or has done, the building work (and any person obtaining the property from that person) is not insured against financial loss if the builder is unable to complete the work or meet a valid claim for faulty workmanship because the builder has died, disappeared or become insolvent.
9. If you received this notice, or a copy of it, after you entered into the contract and you are not a developer of the development, you have a right to rescind the contract (in accordance with the regulations) unless you were given a developer’s notice before you entered into the contract.
10. If you have a right to rescind the contract —
(a) you may end the contract;
(b) you have a right to get your deposit and any other payments made to the builder or developer with whom you have the contract towards the construction, alteration or purchase of the dwelling unit back from the builder or developer; and
(c) the builder or developer cannot recover from you any expenses incurred by them.
11. If you want to rescind the contract you must give the builder or developer with whom you have the contract a “Notice of exercise of right to rescind” before —
(a) the end of one month after the day on which you received this notice; or
(b) settlement,
whichever is the earlier.
The “Notice of exercise of right to rescind” is set out below.
12. Just because you have been given this notice, or a copy of it, does not necessarily mean that the person who gave it to you is at fault.
13. If you are in doubt about your rights, or you don’t understand this notice, you should seek legal advice.
............................................................................................................... Builder | |
Date .......................................... | |
I acknowledge that I have read this notice: | |
................................................................................................................ Person to whom the builder has given this notice | |
Date .......................................... | |
*I acknowledge that I have read this notice: | |
................................................................................................................ Person receiving this copy of the notice | |
Date .......................................... | |
*Complete or delete as necessary.
To ................................................................................................................
[
*I/We .................................................................................................[
*construction/purchase of the ......................................................................
......................................................................................................................
[
................................................................................................................. Person rescinding the contract | |
Date .................................. | |
NB: You should make sure that you have some evidence of the time and date on which you sent or gave this notice. | |
*Complete or delete as necessary.
[r. 7(4)]
1. This notice is about ..........................................................................
..........................................................................................................
2. The
3. Generally, home indemnity insurance covers the person for whom the builder is doing the work against financial loss if the builder is unable to complete the work or meet a valid claim for faulty workmanship because the builder has died, disappeared or become insolvent. The insurance also covers any other person (in this case, you) obtaining the property from that person. In most cases the insurance policy must cover the construction period and the 6 years after practical completion of the building work.
4. Building work on multi‑storey multi‑unit developments is exempt from the requirement for the builder to take out home indemnity insurance, provided that the builder of the development gives a notice (known as a builder’s notice) to the person for whom the builder is doing the work. See the
5. Once the developer engages a builder and the builder has given the developer the builder’s notice, the developer must give you a copy of the builder’s notice within 10 days after receiving the notice.
6. This notice is to warn you that —
(a) the developer has not yet engaged a builder to carry out the building work for the development;
(b) it is likely that the builder will not take out home indemnity insurance for the building work; and
(c) you may not be in a position to assess the risk resulting from the builder not having home indemnity insurance for the building work (should that be the case).
7. If the builder does not have home indemnity insurance for the building work it means that —
(a) the developer; and
(b) you, as a person purchasing the property from the developer,
are not insured against financial loss if the builder is unable to meet a valid claim for faulty workmanship because the builder has died, disappeared or become insolvent.
8. If you are in doubt about your rights, or you don’t understand this notice, you should seek legal advice or contact the Department of Commerce Call Centre on 1300 30 40 54 (local call).
............................................................................................................
Developer
Date ..........................................
I acknowledge that I have read this notice:
...........................................................................................................
Person to whom the developer has given this notice
Date ..........................................
This is a compilation of the
19 Apr 2002 p. 2103‑15 | 20 Apr 2002 (see r. 2) | |
8 Apr 2003 p. 1099‑104 | 9 Apr 2003 (see r. 2) | |
16 Nov 2004 p. 5049‑53 | 16 Nov 2004 | |
21 Dec 2007 p. 6319-20 | r. 1 and 2: 21 Dec 2007 (see r. 2(a)); Regulations other than r. 1 and 2: 22 Dec 2007 (see r. 2(b)) | |
11 May 2012 p. 2059‑63 | r. 1 and 2: 11 May 2012 (see r. 2(a)); Regulations other than r. 1 and 2: 12 May 2012 (see r. 2(b)) | |
SL 2024/287 18 Dec 2024 | r. 1 and 2: 18 Dec 2024 (see r. 2(a); Regulations other than r. 1 and 2: 19 Dec 2024 (see r. 2(b)) | |
basement storey........................................................................................................... 3(1)
builder’s notice............................................................................................... 7(1), 7A(1)
Building Code of Australia....................................................................................... 3(1)
building contract......................................................................................................... 3(1)
building owner............................................................................................................... 12
class.................................................................................................................................. 12
commencement day................................................................................................. 6(1A)
developer...................................................................................................................... 3(1)
exempt building............................................................................................................. 12
exempt work................................................................................................................... 12
former exemption .................................................................................................... 6(1A)
HII cover......................................................................................................................... 12
home indemnity insurance........................................................................................ 3(1)
Housing Authority...................................................................................................... 3(1)
leased retirement village............................................................................................ 3(1)
multi-storey multi-unit development....................................................................... 3(1)
practical completion................................................................................................... 3(1)
purchaser................................................................................................... 4(2), 6(3), 7(2)
relevant period.......................................................................................................... 15(1)
rescind........................................................................................................................... 3(1)
residential tenancy agreement.................................................................................. 3(1)
retired person............................................................................................................... 3(1)
retirement village........................................................................................................ 3(1)
rise in storeys............................................................................................................... 3(1)
sale contract................................................................................................................. 3(1)
SDA building.................................................................................................................. 12
settlement..................................................................................................................... 3(1)
storey............................................................................................................................. 3(1)
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