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Consumer Trader and Tenancy Tribunal (CTTT)
The CTTT deals with certain ‘consumer-type’ disputes, including home building disputes. Its Home Building Division can hear claims up to $500,000.
After an application is lodged by the builder, each party is provided with notification of a hearing date, which is generally 10 to 28 days later.
The CTTT gives the parties a chance to resolve the dispute through conciliation before it hears the matter. Conciliation is a confidential and private process, where a third party (either a Tribunal Member or an independent conciliator employed by the CTTT) attempts to assist the parties to resolve the dispute. If the parties themselves cannot resolve the matter, the CTTT will usually adjourn it to a later date for a further hearing.
The CTTT can make orders that are legally binding. Usually, the process in the CTTT is quicker and cheaper than going through the court-system. The downside is that is some cases, the parties cannot be legally represented.
For more information, see our Online CPD Course Handling Home Building Disputes.
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Security of Payment
The Building and Construction Industry Security of Payment Act 1999 (NSW) establishes a system to allow prompt payment and resolution of disputes in the building industry. Here is a summary of how the system works:
- a person or entity (the Claimant) who provides certain goods / services has automatic rights to progress payments under security of payment laws
- if the Claimant is owed money, they may give the Respondent a written claim for payment (called a Payment Claim)
- the Respondent can pay the Claimant the money being claimed, OR they can give the Claimant a written Payment Schedule if they do not agree with the amount being claimed, and this Payment Schedule can indicate a lesser amount that the Respondent is prepared to pay.
- if the Claimant wishes to recover the full amount that they have claimed (i.e they do not agree with the Payment Schedule), the Claimant can then either go to court to recover the full payment, OR they can go to Adjudication, which is where an independent third party examines the case and makes a decision as to how much is payable
- the decision of the Adjudicator is legally binding, and the process is far less expensive than going to court
However, it is important to note that if the person you are seeking to recover the debt from lives or intends to live in the premises where that work was done (i.e the home owner), you cannot use the benefits of Security of Payment laws to recover the debt.
For more information, see our Online CPD Course Security of Payment Laws.
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Court of Law
After choosing which court you will take legal action in (Local, District or Supreme Courts, depending on the amount of money you are owed), you have to file a statement of claim which contains all of the details of the debt. Once it is filed, you must serve the claim on the other party (handing it to then, sending it by registered post).
The other party then has 28 days to file a defence against your claim, and if they do this, the court will allocate a date to hear the arguments of both parties and make a decision.
If the other party does not file a defence against your claim within 28 days, you can apply for default judgment, and then take legal action to enforce the judgment (seizure of assets, bankruptcy etc).
The court process can be costly and lengthy. Furthermore, if you are seeking to recover a debt owed to you by a home owner for home building works carried out, and you file your claim in a court of law, the home owner can apply to have the matter transferred to the CTTT.
For more information, see our Online CPD Course D-I-Y Debt Recovery.
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