During 2005, NSW home building laws and regulations were changed to:

• establish a new governance structure for home warranty insurance providers and implement associated insurance reforms
• strengthen the builder licensing system
• provide for increased penalties for breaches of the legislation
• put in place other miscellaneous reforms.

Insurance and disciplinary provision amendments

Parts of the Home Building Amendment Act 2004(the Act) related to insurance and some disciplinary matters, commenced 1 September 2005. The Act includes provisions that:

• establish a Home Warranty Insurance Scheme Board to monitor the insurance scheme
• enable the Minister for Fair Trading to enter into an Industry Deed with insurers
• authorise and require insurers to exchange relevant insurance information between themselves and with the Government
• enhance the capacity of insurers to provide information to the Commissioner for Fair Trading  and provide additional secrecy requirements for such information.

The Act also provides new offences for:

• the making of false or misleading applications by builders for insurance
• licensees that knowingly employing a disqualified or unfit person.

Those parts of the Home Building Amendment Act 2004 (the Act) related to licensing, compliance and disciplinary matters, commenced on 29 April 2005. The insurance provisions and some other provisions will commence at a later stage.

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Amendments to licensing provisions

The Act enhances the licensing and certification provisions concerning authorities so that the Commissioner can prevent inappropriate persons from holding authorities. The provisions relate to:

• fitness and propriety to hold a licence
• close associate provisions
• employment of disqualified persons
• wider disciplinary powers in respect of corporations
• cancellation where corporation wound up voluntarily
• requirements for provision of information.

Amendments to disciplinary provisions

The Act:

• expands on the grounds for the taking of disciplinary action
• enables the Commissioner to suspend an authority pending a decision as to whether to take disciplinary action
• increases the maximum penalty that may be imposed.

The provisions relate to:

• false or misleading information with licence applications
• disciplinary action able to be taken against disqualified persons
• employment of disqualified persons
• wider disciplinary powers against building consultants
• additional grounds for disciplinary action
• suspension of a licence pending determination of disciplinary action
• increased penalties for disciplinary action
• increased penalties for corporations to a maximum of $110,000 (1000 penalty units)
• increased penalties for certain offences:
  • offences relating to maximum deposit provisions and failure to disclose information, have increased to $110,000 for a company, $22,000 for an individual
  • jurisdiction - proceedings for a breach of the Act may be dealt with either before a Local Court or the Supreme Court
• new offences include (where the maximum penalties that apply are $110,000 for a company and $22,000 for an individual):
  • engagement of unlicensed contractors by licence holders and owner-builders
  • lending of licences
  • non provision of information re sub-contractor.

Miscellaneous amendments

• clarification of provisions related to the voiding of contracts of sale where insurance has not been obtained
• changes to the Public Register
  • the Act now enables the Commissioner to remove false, erroneous, misleading or unfairly prejudicial particulars about the holders of authorities from, or to otherwise amend the particulars in, the public register
• other amendments
  • the Act enables documents to be served by posting them in a letter to the last known address of an individual or the address last known as the principal place of business of a corporation, respectively and replaces the definition of Director-General to reflect current administrative arrangements.