Construction Contracts Act 2002 under review

Building and Construction Minister Maurice Williamson has released a discussion document on the Construction Contracts Act 2002 today.

The Act regulates progress payments under construction contracts and provides an adjudication process for people with building disputes.

The Act is being reviewed in response to feedback received through the Building Act review.

"The submissions we received were very supportive of the Act's adjudication process but feedback suggests there is some confusion about the types of disputes that can be heard."

The Act currently excludes residential construction contracts from the clauses relating to progress payments and the enforcement of adjudication orders. This can expose residential consumers and contractors to more risk and can make it difficult for them to resolve disputes and obtain financial redress.

The discussion document asks if this exclusion is still relevant and if it should be removed.

"While the Act works reasonably well for people with commercial construction contracts, there is room for improvement.  The application of the Act to residential constructions needs amending to increase and improve consumer protection so people carrying out residential building work are better equipped to use the Act to hold builders to account."

"We want to hear from people who have used the Act's adjudication process to resolve building disputes. This will help us to identify what's working well and to address those areas of the Act that require improvement."

Submissions on the discussion document can be forwarded to the Department of Building and Housing.  The consultation closes on 16 December 2010.