New guide to help define defects (Part 2)

MBIE’s latest guidance aims to resolve common areas of dispute between contractors and homeowners 

The Guide to tolerances, materials and workmanship in new residential construction is now available. Prepared by the Ministry of Business, Innovation and Employment (MBIE), it aims to assist contractors and homeowners, who may be unsure of what constitutes a defect within the Building Act 2004.

This guide focuses on issues that can lead to disputes between building contractors and homeowners, but which fall outside the Building Code, contract documentation and manufacturers’ specifications and installation instructions. It outlines what constitutes acceptable levels of workmanship in standard domestic construction types under normal conditions, and is targeted at new residential building work.

“A building contractor cannot be held liable for work or damage caused by the owner, occupier, or by another person contracted separately by the owner to complete a certain task

Consumer protection measures

The guidance was written with advice from the industry and supports the new consumer protection measures in Part 4A of the Building Act, which came into law on 1 January.

Under the new consumer protection measures, a 12-month defect repair period starts from:

• the completion of the building work under a written contract, or
• the completion of the physical building work, in cases where there is no written contract.

During this time, it is the main contractors’ responsibility to fix any defects, or prove that any defective building work is through no fault of their own, the subcontractors under their control, or the products supplied if there is a dispute.

What’s covered?

The Guide to tolerances, materials and workmanship in new residential construction covers mainly aesthetic issues (eg, what is considered a reasonable slope in a floor, or what is an acceptable appearance for a newly painted wall) in new builds and additions at any price, whether or not the consumer protection measures and $30,000 threshold apply.

The guide does not cover tolerances for repairs, renovations, or alterations within existing buildings. Tolerances for existing buildings are likely to be below those achievable with new buildings. There are a number of reasons for this, including the nature of the materials used in existing buildings and the effects of both time and natural events.

It is also a great tool to make sure clients understand and agree what acceptable levels of tolerances, materials and workmanship are for new residential building work. It can be used before contracts are signed, to help align expectations of quality with choice of design, materials, finishes and costs.

The Guide to tolerances, materials and workmanship in new residential construction is not a mandatory set of standards. Contractors and clients can mutually agree to their own expectations, preferably within their written contract.

What is a defect?

The defects covered in this guide are specific to those resulting from the actions (or inactions) of the building contractor. A building contractor can only be held liable for work done within the construction contract, and by the specialist trades they have commissioned. A building contractor cannot be held liable for work or damage caused by the owner, occupier, or by another person contracted separately by the owner to complete a certain task.

The building contractor cannot be held liable for an event that is not attributable to the building contractor, including:

• Damage that occurs outside of human control – eg, a natural disaster.
• Damage done by a person outside of the building contractor’s control.
• Damage resulting from a failure to undertake normal maintenance.
• Damage resulting from a failure to carry out repairs as soon as practicable after the defect becomes apparent (section 362S).
• If an owner requires a building contractor to carry out work the building contractor knows will result in a less-than-satisfactory finish or outcome for one or both parties, this should be put in writing to the owner before commencing such work.

Owner dissatisfaction with an outcome that is installed to specification and to a reasonable standard (as outlined in this guide) is not a defect. For example, an owner cannot expect a level 5 plaster finish if the specification called for a level 4 plaster finish.

ISSUES EMERGING OVER TIME

Over time, buildings are subject to the weather, shaking from traffic, minor earthquakes and ground settlement. These result in gradual deterioration of materials (particularly exterior cladding and exterior timbers used in decking, fencing and pergolas, etc), and often development of non-structural cracks at joints and junctions in sheet materials (particularly internal wall and ceiling linings). Unless otherwise agreed in the contract, provided these remain within the tolerances found in relevant parts of this document, they are not considered defects. Where issues emerge after the 12-month defect notification period, these may still be covered under the implied warranties or other legislation (see ‘Introduction of new consumer protection measures’).

FIND OUT MORE

Find out more about the consumer protection measures at doyourhomework.co.nz, and download your copy of Guide to tolerances, materials and workmanship in new residential construction at www.building.govt.nz/guide-to-tolerances.