Builder Never Got Council Approval? Your Rights as a Homeowner

You find out at sale time, or when council sends a letter, that the extension your builder put up three years ago never had a permit. Suddenly you are the one facing a notice, a retrospective approval bill and a buyer walking away. Here is how to shift that cost back to the person who caused it.

Who was responsible for getting approval?

Read your contract first. The standard HIA and MBA contracts either make obtaining approvals the builder’s job or require the builder to confirm that all necessary approvals are in place before starting. Even where the contract is silent, the law helps you:

• New South Wales – Section 18B(1)(c) of the Home Building Act 1989 implies a warranty that the work will comply with “this or any other law”. Building without development consent or a complying development certificate breaches the Environmental Planning and Assessment Act 1979, so it breaches the warranty.
• Victoria – Section 8(c) of the Domestic Building Contracts Act 1995 warrants compliance with all laws and legal requirements, including the Building Act 1993 requirement for a building permit.
• Queensland – Building without a permit breaches the Building Act 1975 and the Planning Act 2016. It is also unlicensed or non-compliant work under the QBCC Act 1991, which the QBCC will act on.
• Western Australia – The Building Act 2011 requires a building permit. Building and Energy can issue a building order and take disciplinary action against the builder.

The Australian Consumer Law also applies. A builder who represents that “it is all approved” when it is not has engaged in misleading or deceptive conduct under section 18, and the work is not fit for purpose under section 61.

What you are actually facing

1. A council notice ordering you to obtain approval, rectify or demolish. Do not ignore it. Respond in writing and ask for time.
2. Retrospective approval. In New South Wales this is a building information certificate under section 6.24 of the EP&A Act. In Victoria it is a building permit for existing work. Queensland councils can approve “as constructed” work. Expect to pay for a private certifier or surveyor, an engineer’s report and council fees.
3. Rectification work if the structure does not meet the National Construction Code. This is where costs blow out.
4. Insurance and sale problems. Unapproved structures can void home insurance and must be disclosed on sale.

Step-by-step: making the builder pay

1. Get the paperwork. Request the builder’s file: contract, plans, any approval documents, certificates. Search council records yourself. Establish exactly what was and was not approved.
2. Quantify the damage. Get quotes for the retrospective approval process and any rectification. Ask the surveyor or certifier for a written scope. Add council fees and your own costs.
3. Check the clock. In New South Wales the six-year major defect warranty period runs from completion. Victoria gives up to ten years. Queensland’s Home Warranty Scheme has its own timelines. Do not wait.
4. Send a letter of demand. Demand that the builder either obtain the retrospective approval at their own cost, including any rectification, or pay you the quoted amount. Cite the statutory warranty for your state and the ACL. Give 14 days.
5. Complain to the regulator. NSW Fair Trading, the Building and Plumbing Commission (formerly the VBA), the QBCC and Building and Energy in Western Australia all treat unapproved work as a serious licensing matter. A complaint puts the problem on record with the regulator.
6. File in the tribunal. NCAT, VCAT, QCAT or SAT can order the builder to pay the cost of approvals and rectification. Your letter of demand and the regulator complaint form the basis of your case.

If the builder has gone bust or disappeared

Claim on the home warranty insurance. New South Wales HBCF, Victorian DBI and the Queensland Home Warranty Scheme all cover non-completion and defects where the builder is dead, insolvent or has disappeared. Get the claim in early. There are notification deadlines.

Get moving today

Claim Done drafts your Letter of Demand for $49, citing the statutory warranty and planning law breaches for your state and demanding the builder fix or fund the approval. If they will not budge, Claim Done drafts your Tribunal Application for $97 so you can file in NCAT, VCAT, QCAT or SAT with the right claim wording.

Start my Letter of Demand – $49  |  Start my Tribunal Application – $97