Do all residential building disputes have to be determined by the NSW Civil & Administrative Tribunal (“NCAT”)?

Generally, a builder or home owner may commence proceedings in relation to a residential building dispute in:

1. a Court of competent jurisdiction (subject to relevant limitation periods), or
2. in the NSW Civil & Administrative Tribunal (“NCAT”) provided that:

• • The amount claimed does not exceed $500,000.00 (Section 48K(1)), and
  • Proceedings are commenced within three (3) years of the related supply of building goods or services (Section 48K(3)).

Notwithstanding, it is apparent from the Home Building Act that NCAT is to be chiefly responsible for resolving building claims in NSW.  Significantly, Section 48L(2) of the Home Building Act provides that if a Defendant in any Court proceedings in respect of a building claim makes an application for the proceedings to be transferred to NCAT, the proceedings must be transferred and will thereafter continue before NCAT as if they had been commenced there.

Whilst case management by Judges and Magistrates may be preferable to case management by NCAT Members, unless the parties agree for the proceedings to be determined by a Court (and not a Tribunal) or no Defense to a claim is anticipated, then it is usually the case that proceedings for claims under $500,000.00 should be commenced in NCAT or will ultimately end up being determined by NCAT.

There remains, however, some strategic benefits of commencing proceedings before a Court even if the claim will be disputed.  For example, Court proceedings will permit the early issue of Subpoenas and the accessing of documents from third parties under Subpoena.

Parties who commence their own proceedings will typically miss this opportunity and, in any case, will invariably set themselves up for delays and additional costs associated with the subsequent need to properly plead and particularise their Points of Claim in order for the proceedings to efficiently proceed.

Ultimately, before commencing any proceedings before a Court or NCAT in relation to a building claim it is strongly recommended that you speak to a Building & Construction Lawyer.