Settlement Deeds and Agreements
Posted 19 May 2024
Category: Building Defects, eBooks
2 years, 6 years, 10 years, 12 years
A Settlement Deed provides the greatest protections for a scheme to enforce its rights and can be sued under for 12 years.
A Settlement Agreement (Contract) can be sued under for 6 years.
Be careful when negotiating a settlement agreement or deed, because you might be giving up some rights if you don’t carefully review the wording.
If the settlement deed or agreement provides that any warranties provided are limited to those provided for under the Home Building Act 1989 (NSW), you could be limiting yourself to only a 2 year warranty period for non-major defects and 6 year warranty period for major defects.
However, a 2 / 6 year warranty period might still be better than only having 12 months to enforce a Work Order made by the Tribunal.
Generally, a reputable builder would be willing to return to rectify defects, by entering into a settlement deed or agreement.
A settlement deed or agreement will usually contain a dispute resolution provision or expert determination provision for dealing with breaches or disputes.
Don’t forget to consider the 10-year long-stop period for building actions imposed by section 6.20 of the Environmental Planning and Assessment Act 1979 (NSW).
This is an extract from our Bannermans Building Defects Guide – Part 2.
To access more FAQ'S on Building Defects fill in the below form to download our Bannermans Building Defects Guide – Part 2 for free.
