Consumer protection measures regulations published

MBIE releases new rules for consumer protection measures coming into force on 1 January

The Ministry of Business, Innovation and Employment (MBIE) has just released regulations for the new consumer protection measures, included in the Building Amendment Act 2013 and set to come into force on 1 January 2015.

The changes will require building contractors undertaking residential building work valued at more than $30,000 to have written contracts, provide information on their relevant skills, experience and qualifications, and disclose their insurance and warranty cover. If the building work is valued at less than $30,000, the above information is required if specifically requested by the homeowner.

The Building (Residential Consumer Rights and Remedies) Regulations, found here, includes revised Schedules 1, 2 & 3.

Schedule 1: lists the prescribed disclosure information in detail, which includes information about the building contractor, the key contact person, insurance policies and any guarantees or warranties.

Schedule 2: outlines the prescribed checklist, which a building contractor is required to provide the homeowner if;

• The homeowner requests the checklist and the prescribed disclosure information; or
• The building work is going to cost $30,000 or more.

The checklist, available here, outlines the steps homeowners should take to ensure a smooth building process.

Schedule 3: defines the implied terms associated with residential building contracts, which will apply as default clauses if they haven’t been otherwise covered in a contract. It states that the building contractor is responsible for obtaining building consents andcode compliance certificates, and covers variations, payments, subcontractors, dispute resolution and notices.

MBIE has also released Building (Infringement Offences, Fees and Forms) Amendment Regulations 2014, found here, which includes updated infringement offences and fees.

While the new regulations are motivated by protecting consumers, MBIE says the new measures will also help protect builders, particularly those who haven’t been using written contracts. Most disputes come back to what’s written in the contract.

New guidance released

Additional guidance – one for homeowners and one for builders – has now been released. All resources are available for download from www.doyourhomework.co.nz.