When you Must have a Written Contract (Victoria)

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A written contract is vital if you are going to build a house, or intend repairing, renovating, or extending your home, regardless of how much you are spending.

It is a crucial document in settling any dispute with your building contractor. Essential requirements for home building contracts are set out in the Domestic Building Contracts Act 1995.

We recommend you have a written contract for all building works, regardless of size and price.
By law, you must have a written ‘major domestic building contract’ for work worth more than $5000, including:

• Erecting or constructing a home and associated landscaping, paving, retaining structures, driveways, fencing, lighting, heating, air conditioning, water supply or sewerage
• Renovations, alterations, extensions, repairs, and any other improvements
• Work associated with renovation, alteration, extension, or repair of a home. This includes landscaping, paving, retaining structures, driveways, fencing, garages, workshops, swimming pools or spas
• Preparation of plans or specifications by the builder (unless prepared by a registered architect, engineer, or draftsperson)
• Demolition or removal of a home
• Any work associated with building on land zoned for residential purposes and for which a building permit is required

Only registered builders can:
• Enter into a major domestic building contract and take out domestic building insurance, which is required for work over $16,000 and protects you if the builder dies, becomes insolvent or disappears
• Reblock, restump, demolish, or remove a home, regardless of the value of this work

You are not required to have a domestic building contract for jobs that involve only one of the following:
• Plastering
• Tiling (wall and floor)
• Electrical work
• Glazing
• Insulating
• Painting
• Plumbing, gas-fitting, and draining
• Installing floor coverings
• Attaching external fixtures (awnings, security screens, insect screens and balustrades)
• Erecting a chain wire fence around a tennis court
• Erecting a mast, pole, antenna, aerial, or similar structure

However, we recommend you have a written contract for all work carried out on your property. The builder is required to give you sufficient time to have the contract documents reviewed by your legal representative before you sign.

Some building contractors use standard contracts prepared by industry organisations. Even if your contract is standard, we recommend you get independent legal advice before you sign – although this means you no longer have five days to change your mind after signing the contract.

The builder must also give you a copy of the contract signed by you and the builder. Do not accept a copy unless it has been signed by the builder.