Introduction
Dealing with construction issues in your new home can be hard work, especially when communication with your builder breaks down. In Queensland, homeowners have the added benefit of QBCC homeowners warranty insurance, which includes a mediation process to resolve disputes.
In this blog post we will guide you through the QBCC mediation process, from understanding your insurance policy to successfully navigating mediation. Learn how to protect your investment and achieve a fair resolution without unnecessary stress.
If your building in Queensland, included in the purchase price of your new home is QBCC homeowners warranty insurance. As long as your claim against the builder is within six years and six months of the date of practical completion, the QBCC will investigate your concerns and advise you a course of action. If you contact the QBCC to raise a claim after six years and six months, you will most likely get a letter advising that your claim is outside the period of coverage.
The Beginning
Once your builder pays the QBCC insurance, and the details are processed, you will receive the insurance policy booklet in the mail. It looks like the picture below.
In my experience, this booklet is the most misplaced document in construction. At practical completion stage, I make it a point to ask clients if they have read this booklet. Most often I get blank faces and "what" as a response. Think of your homeowners warranty insurance as you do your health insurance. If you do have an issue with our new home, you can check out your concern with the insurance provider to see if you will or won't have to pay to repair the issue.
If that wasn't enough to get you interested in looking out for this insurance, consider then the price you have paid for it to see if that motivates you. QBCC homeowner warranty insurance costs between $1900 and $3000 per house (dependant on the contract value). If you compare this to your home and contents or car insurance, from a policy size perspective, it's larger than your contents and car insurances combined. Once people know this I find they are happy for one, knowing they have coverage, and two surprised that it even existed at all.
QBCC mediation is a really good option if you are not having any luck with your builder attending to your concerns about the performance of your house construction. Mediation is an informal way for people to resolve disputes with the help of a neutral mediator who is trained to help people discuss their differences. In the context of the QBCC, mediation is a process where the homeowner alerts the insurer (QBCC) of a issue about their newly constructed home.
How does this work?
It's a very easy process. You lodge a complaint against the contractor with the QBCC. The complaint is a detailed account of your perspective on the issue that includes a timeline, correspondence and feedback you have received from the builder. Photos are a great way of detailing to a third party what the issue is.
The QBCC contacts the builder and advises them of a claim against the home warranty insurance. In this advice, they detail your perspective of the issue and ask the builder for comments and paperwork to support their perspective. You submit this to the QBCC, and once processed, you will receive notification if mediation is required and when it may occur.
When it comes to the day of mediation in attendance will be a QBCC mediator the builder and yourself. The purpose of having the mediator attend with you and the builder, and onsite, is to visually inspect the details of the dispute. The overriding purpose of this meeting is to reach a win-win between both parties. The mediator takes photos, notes and asks questions of both parties. Hopefully, a resolution is reached at mediation. You will know when you have reached a resolution because the mediator will write down an action point then ask you and the builder to acknowledge the decision by signing.
If a resolution is not reached the mediator will take away what they have collected from the site meeting: photos, notes, measurements to review. The mediator will use the Building Code of Australia and its referenced standards as a benchmark for making a determination (is it is possible). If they need more information from either party, they will reach out and make a request for information. You may be required to engage consultants to provide additional information. Consultants could be engineers, inspectors, surveyors, accredited professionals or legal and advisory types.
If the mediator determines that the builder has not adhered to the building code or its referenced standards, they will ask the builder to rectify the issue at their cost. They will also reference how they made their decision so that each party can see what was considered and why they made the decision they did.
If the mediator determines that the builder is not at fault, there are two possible outcomes. Firstly, the QBCC may advise you that they will cover the repair work under the provisions of the home owners warranty insurance. Secondly, they may advise you that the builders' work is deemed to satisfy the provisions of the Building Code and its referenced standards. Deemed to satisfy means that the element meets the minimum criteria for acceptable performance as defined by the BCA and Australian Standards.
How to succeed in mediation is very simple.
A hard as it is, try not to be emotional. I understand how difficult this is coming from a reformed "hot head" but it is the best way to ensure you present a logical case.
Secondly, don't make things up just to "point score". Mediators do this for a job, and they have seen and heard all the tricks when it comes to attempting to sway judgement. Anything that sounds like "fluff" will be discounted or ignored completely, which is not a good thing.
Thirdly, keep good records.
Take measurements and photos to document your concerns. Do this as soon as you first notice the issue and then do it regularly until your mediation. When taking pictures of cracks, for example, always do so with a ruler or similar marking gauge in the photo. Using a gauge will provide the viewer with comparative perspective and will assist in understanding what you are communicating. Don't let poor communication prevent you from getting your point across.
Do use simple words to communicate what's going on. You don't have to know "builder's speak" to communicate an issue. Lastly, don't use abusive language in how you try to get your builder to take action or face to face. As soon as the conversation gets emotional or abusive everyone's guard goes up, communication stifles, and the likelihood of success in the mediation reduces significantly.
It's important to know that as of June 2015 the QBCC may bring an action against tradesman as well as the builder. Prior to June 2015, the QBCC only permitted clients to take action against the Builder (or the principal contractor). It was up to the Builder to take action against the tradesperson to recover the costs of rectification.
Your Guide to the QBCC Dispute Resolution Process
Further Reading
Anthony Painter
Anthony Painter
Anthony Painter
Anthony Painter
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