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It is recommended that you enter into a contract for residential building work. These contracts generally outline steps to be taken in the event of a dispute. For example, the HIA ACT Residential Building Contract for Alterations and Additions states that:
Disputes must be resolved according to Territory laws that govern the resolution of building disputes. The owner and the builder must meet within 7 days to discuss the matters and attempt to resolve them by negotiating, mediation or other agreed method.
Where disputes continue beyond the scope of the contract (i.e. the builder and owner cannot reach a negotiated agreement), then legal action may follow.
Most building disputes in the ACT that cannot be resolved between the parties end up in the ACT Civil and Administrative Tribunal (ACAT). The ACAT can hear and determine a civil dispute relating to an amount of $10,000 or less. It provides a forum for the determination of a wide range of civil disputes, including disputes between builder and owner and builder and subcontractor. There is also a rapid adjudication process through security of payment laws that can be used for disputes between builders and contractors from 1 July 2010.
An application would need to be lodged under the general civil provision. Forms can be obtained from the ACAT website. A fee will be charged for lodging an application.
Note: Claims above $10,000 but under $50 000 proceed through the Magistrates Court.
A matter will usually be heard at a ‘hearing’ in front of an ACAT member. Each party will be given the opportunity to state their case. Depending on the circumstances you may also call witnesses to give evidence. The tribunal members will encourage both parties to discuss the dispute and may suggest ways in which it might be settled. If an agreement is not reached, the Tribunal will make a decision. Both agreements and decisions are binding and can be enforced in the same way as an order of the Court.
When making an application it is important to remember:
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