Statutory warranties and defects liability in SA

What are the statutory warranties on building work in SA?

They are warranties the Act implies into the contract, and the Form 1 notice says they “apply regardless of what your contract says”. The Law Handbook, published by the Legal Services Commission of South Australia, records that section 32 “implies certain statutory warranties into every domestic building work contract”. The prescribed Form 1 notice, in its September 2024 version, sets them out as follows.

The work must be performed in a proper manner to accepted trade standards and in accordance with the agreed plans and specifications. The materials supplied by the building work contractor will be good and proper materials. The work will be performed in accordance with all statutory requirements. Unless the contract stipulates a period within which the work must be completed, it will be performed with reasonable diligence. If the contract is for the construction of a house, the house will be reasonably fit for human habitation. And if the owner has made known the purpose of the work, or the result wanted, “in a way that demonstrates that you are relying on your contractor’s skill and judgment”, the contractor warrants that the work and materials will be fit for that purpose, or of a nature and quality that they might reasonably be expected to achieve that result.

The Handbook’s minor work page says these warranties “apply whether or not the work is considered minor”. The Act as consolidated at 1 January 2024, an archived version that predates the January 2026 changes, gave a builder a defence where the deficiencies arose from instructions the owner insisted on contrary to the builder’s written advice.

The current version of the Act could not be read for this note, so statute points are attributed to the Handbook, and the September 2024 Form 1 notice is used for the wording of the warranties.

How long is a builder liable for defects in SA?

No single period answers this, because it depends on the legal route. For the section 32 warranties, the Law Handbook records that proceedings “must be commenced within 5 years after completion of the building work”, citing section 32(5), and that “This strict time limit cannot be extended”, citing section 32(6) and Duncan v Bert Farina Constructions Pty Ltd [2024] SASCA 67.

That is a limit on starting proceedings. The pages read for this note do not define when building work reaches completion, which is a question for legal advice.

Separately, under section 159 of the Planning, Development and Infrastructure Act 2016 (SA), the Handbook records that no action for damages for economic loss or rectification costs resulting from defective building work may be commenced more than 10 years after completion. It calls this a “long stop limitation period”. It limits those damages actions; it is not a warranty.

The Australian Consumer Law may also be relevant, and the Handbook says “Different time limits apply to these actions”. Its Consumer Protection page, last revised on 14 December 2021, records that a claim for loss or damage “must be lodged within 6 years”, citing section 236, without saying when that period starts or which Australian Consumer Law claims it covers. Consumer and Business Services says owners “may also have rights under the Australian Consumer Law that extend past the five year limitation of the statutory warranties”.

What is a defects liability period?

It is a period after hand-over for raising defects, and the contract is the document to check for it. The Law Handbook’s building work pages read for this note do not use the term “defects liability period”. South Australia’s Consumer and Business Services uses “maintenance period”, and Queensland’s QBCC treats the two as the same thing, describing a maintenance period as “also known as the defects liability period”. The QBCC is used here only for the term; its rules are not South Australian law.

Consumer and Business Services’ consumer guide of January 2025 describes, after hand-over, “a maintenance period of 90 days for you to let them know about any minor defects in the property”, as what it says builders generally allow. It adds: “Owners are not limited to raising issues concerning defects within the first 90 days”, and says that, in many circumstances, a builder’s obligation to repair defects can run “for many years”.

The QBCC says checking the contract “will confirm if a maintenance period applies, how long it lasts and what each party’s rights and responsibilities are”.

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Defects liability period vs warranty: what is the difference?

The main difference is where each comes from. A maintenance or defects liability period is something to check in the contract; the section 32 warranties come from the Act, which implies them into the contract.

The time limits are stated differently too. The Handbook states the section 32 limit by reference to completion of the building work, and its account does not tie that limit to a defects liability period.

The Handbook also records that a contract “cannot purport to exclude the effect of the Building Work Contractors Act 1995 (SA) and its provisions, and any term to that effect is void”, citing section 42. How a defects liability clause and section 32 sit together in a particular contract, and whether a particular defect is covered, are questions for legal advice.

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What is a structural warranty, and is it the same as building indemnity insurance?

The sources read do not treat them as the same thing: building indemnity insurance is set out in the Act, while “structural warranty” is not a term in the Law Handbook pages read for this note, and they do not list it among the section 32 warranties. Where a document uses the phrase, that document says what it means. The points to read are who gives it, what it covers and excludes, how long it runs and how a claim is made.

The Handbook records that building indemnity insurance covers a building owner for defective building work, up to a limit, “in cases where the builder dies, disappears (or is otherwise unable to complete the work) or becomes insolvent”. Consumer and Business Services says the minimum cover rose for new policies commenced from 10 November 2025. The archived 2024 Act did not apply the insurance rules to minor domestic building work or to work that did not need approval. The Handbook says the requirement applies “over” a contract value, while the Consumer and Business Services consumer guide says “or more”, so a contract at exactly that value should be checked against the current Regulations.

Do statutory warranties pass to the next owner?

The Law Handbook records that “The statutory warranties in s 32 are passed on to subsequent owners of the property”, citing section 32(3) and (4). It states the 5-year limit by reference to completion of the building work and does not give a separate period for a later owner.

Separately from section 32, its Defective building work page records that the High Court has accepted that subsequent owners “may be able to take action against a builder for defective building work, at least in relation to residential dwellings”, citing Bryan v Maloney, and notes that a later High Court decision on a strata-titled complex distinguished that case on its facts.

What happens when a defect appears?

The Law Handbook’s first step is to talk to the builder “as soon as they notice a problem”. If that does not resolve it, it says the owner “should seek legal advice”.

It records that Consumer and Business Services may assist in negotiations with the builder, or “if necessary convene a conciliation conference under section 8A of the Fair Trading Act 1987 (SA)”.

The options it names for legal advice include further negotiations, conferencing or court proceedings based on the statutory warranties, the requirement to comply with technical details and building rules under the Planning, Development and Infrastructure Act 2016 (SA), or some other basis such as the Australian Consumer Law.

The Handbook states that its content “should not be relied upon as a substitute for legal advice”, and gives a number for free and confidential legal advice in South Australia: 1300 366 424.

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