When you sign a domestic building contract, you might assume that everything you’re agreeing to is written on the page. But what if we told you that, under Victorian law, you’re also agreeing to a series of promises outlined in legislation?
These promises are known as implied warranties – non-negotiable obligations that apply by law to nearly every domestic building contract in Victoria. Whether you’re building a new home, renovating, or managing a residential construction project, understanding these warranties is essential. They are often the foundation of legal claims when building works go wrong, yet they’re commonly overlooked until it’s too late.
So, what exactly are you promising?
What Are Implied Warranties?
Implied warranties are legal guarantees that automatically form part of a domestic building contract. They’re not negotiated or drafted into the agreement; rather, they arise under the Domestic Building Contracts Act 1995 (Vic) and apply whether you’ve thought about them or not.
These warranties require that the building work be done properly, using new and suitable materials, and in accordance with all relevant laws. Among other warranties, the builder must also complete the job with reasonable care and skill, finish within the time set out in the contract, and ensure that the finished product is fit for its intended purpose.
When Do These Warranties Apply?
These warranties apply automatically to any domestic building contract that involves residential construction work in Victoria. And they’re binding – a contract clause attempting to remove or limit them is void under the law. They are hardwired into the contract and enforceable no matter how the builder’s role is defined.
There is, however, one narrow exception. If a homeowner knew, or ought reasonably to have known, about a defect or issue at the time of signing the contract, they cannot later rely on the warranty to claim compensation for that specific defect. But even then, the builder bears the burden of proving the owner had such knowledge – and this is no easy task in practice.
The Impact of a Breach
Breaching an implied warranty can have serious consequences for builders. And unlike other forms of liability, these obligations are not shared or apportioned. If a builder fails to deliver what the law demands – whether it’s proper workmanship, timely completion, or suitable materials – they are fully responsible.
Time Limits and Enforcement
There is a ten-year window to take legal action over breaches of these warranties, under s134 of the Building Act 1993 (Vic). It’s also worth noting that these legal rights exist alongside consumer protections under the Australian Consumer Law, which also requires that services be delivered with due care and skill, within a reasonable time, and fit for their stated purpose.
Why It Matters
For homeowners, these implied warranties offer powerful protection. They ensure that even if you didn’t think to include a specific term in the contract, the law has your back. For builders, they act as a standard of accountability that can’t be waived or avoided. The key is understanding that they exist, complying with them throughout the construction process, and knowing how to act if something goes wrong.
At Warlows Legal, we regularly advise both builders and homeowners on how to prevent and resolve disputes arising from breaches of these hidden promises. Whether you’re signing a new contract, managing a project, or dealing with defects after completion, understanding your rights and obligations under the law is essential.
If you suspect that one of these implied warranties has been breached – or if you’re unsure whether your contract complies – don’t wait until the problem gets worse. Legal advice early on can make all the difference.
Contact Warlows Legal for more assistance.
