Your rights

You have limited options if you and your builder have a falling out. You can try to settle the dispute directly - but if that doesn't work, who do you turn to?

In projects that use a standard building contract, there's an arbitration procedure in case of disputes. But many building hassles are over jobs that don't use a standard contract.

Mandatory warranties

Since November 2004, mandatory warranties - designed to protect consumers - have been inserted in contracts for building work. The warranties include the expectation that the work will be done competently using suitable materials, completed within a reasonable time and so on.

The problem is enforcing the warranties. You could take your building dispute to the local Disputes Tribunal - but the maximum claim a tribunal can hear is $20,000 (and that's with the consent of both parties). Many building disputes are for sums of money much greater than that. You're left with the courts, which are costly and often unpredictable; or with the Weathertight Homes Resolution Service, which deals only with leaky homes.

This is highly unsatisfactory. Consumers deserve better protection for one of the most costly purchases they're ever likely to make.

Licensed building practitioners' scheme

The Department of Building and Housing introduced a licensed building practitioners' scheme in November 2007. Occupational licensing aims to make sure that people in the building industry are competent and accountable. A building practitioners' board will hear complaints against licensed building practitioners (among other duties). But while the board can fine or suspend builders from the scheme, it isn't meant to be a form of redress for consumers.

So the cautious homeowner will still look for extra cover when building a house or doing renovations - such as a building guarantee.