Licenced contractors must insure their building works pursuant to s 92 of the Home Building Act 1989 (NSW) (the “Act”). Nevertheless, there have been several disciplinary proceedings brought against licenced contractors who have failed to obtain insurance.
In the case of Pobjie v Commissioner for Fair Trading, Pobjie Agencies (“Pobjie”) was contracted to perform building works beyond the insured value. The Commissioner for Fair Trading suspended Pobjie’s licence and issued a notice to show cause calling on the director to show cause why he should not be disqualified from being a licence holder.
The director was unable to show cause and accordingly was disqualified from holding a licence for 10 years. The reasons given for the lengthy disqualification was because the director was aware that Pobjie did not have the necessary level of insurance, but still made the decision to perform works. This led to the adverse finding that he was not a fit and proper person to hold a licence under the Act.
The Administrative Decisions Tribunal noted that it has always regarded breaches of s 92 as a matter of great seriousness. The substantial public harm which may be suffered as a result of the lack of insurance required the director to be excluded from the home building industry for a significant period for the protection of the public.
Tips
- Do not agree to perform building works without first gaining the necessary level of insurance;
- If you do not have sufficient insurance but are still completing works, seek advice immediately as you may be able to rectify the problem.
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This article is not legal advice and should not be relied upon as legal advice. All articles found on this website are intended to provide informative information, nevertheless, in many instances legislation and case law has been simplified and/or paraphrased. If you would like personal legal advice based on your current circumstances, you should contact MurdockCheng Legal Practice for a free consultation.