Subcontractor’s Liability For Defective Building Works

From 1 June 2015, the Queensland Building and Construction Commission (‘QBCC’) will have the power to pursue building industry subcontractors for defective works that they complete. The introduction of the Accountability and Subcontractor Defects Policy is designed to ensure that subcontractors are held directly accountable for any rectification works that need to be undertaken. Previously the QBCC pursued largely the principal contractor for any defective works, even those works completed by a subcontractor.

How the Policy Works
Where a consumer makes a complaint about defective building works to the QBCC, the complaint will be assessed and a determination will be made as to whether the work is in fact defective. If the QBCC establish that the work is defective, and the subcontractor is found to be responsible for the defective work the QBCC will issue to the subcontractor and the principal contractor a Direction to Rectify. A Direction to Rectify will only be issued in the event the contractor responsible for the work is unwilling to rectify the defective work, or the principal contractor has difficulty in getting the subcontractor to rectify the defective works.

In the event the subcontractor or the principal contractor complies with the Direction to Rectify there will be no note of the Direction made on their public record. Alternatively, if the subcontractor fails to rectify the defective works in accordance with the Direction, the subcontractor will face disciplinary action which may result in their licence potentially being suspended or cancelled. The repercussion of a failure to rectify works is therefore substantial and should be actioned immediately.
In the event the subcontractor fails to rectify the works, the principal contractor will be responsible for either fixing the defective works themselves, or hiring another subcontractor to fix the defective works at their own cost.

It is important that subcontractors are aware that as from 1 June 2015 the QBCC has adopted a new policy which is designed to ensure all subcontractors are held accountable for defective building works they perform and can issue them with a Direction to Rectify directly. Subcontractors should familiarise themselves with the QBCC dispute process to ensure that in the event a Direction to Rectify is issued, they are apt to adequately address any allegations raised and respond accordingly. Subcontractors should therefore ensure they are able to clearly identify their scope of work and keep any relevant documentation to ensure that any allegation against them is well founded.

If you require further information or assistance please contact your preferred solicitor at our office.