What a building contract must include in SA

What is a building contract in SA, and when do these rules apply?

A building contract is the agreement between a building owner and a builder for the work, and in South Australia domestic building work is dealt with under the Building Work Contractors Act 1995 (SA) and its regulations. The section 28 contract requirements below apply to contracts that are not minor domestic building work. The Act as consolidated at 1 January 2024, an archived version that predates the January 2026 changes, excluded minor work from them and defined it by a cost below a sum prescribed by regulation. The Law Handbook records that sum as raised on 10 November 2025; its page linked under Sources gives the figure.

The sources word the boundary differently. The Handbook’s contracts page says “more than” that figure and its minor work page “less than”, while the Consumer and Business Services consumer guide says “or more”. A contract at exactly that value should be checked against the current Regulations.

This note could not read the current versions of the Act or the Building Work Contractors Regulations 2026, so statute points are attributed to the Law Handbook. Where it uses the Form 1 notice, it uses the September 2024 version, which predates those Regulations.

What should a building contract include?

The Law Handbook records that section 28 requires every domestic building work contract outside the minor category to be in writing and legible, to “set out all of the terms of the contract”, to include details about the builder, “such as their business name and licence number”, and to be signed by both the building owner and the builder.

That is a summary, not a closed list. A Lynch Meyer Lawyers update of 27 March 2026, a law firm’s summary used here because the January 2026 version of the Act could not be read, adds that the contract must comply with any requirements of the regulations about its contents.

On signing, the archived 2024 Act allowed a party to sign personally or through an authorised agent, while the Lynch Meyer summary says “personally” and mentions no agent. If someone else will sign, the current wording should be checked.

The Handbook adds that a signed copy of the contract, along with the prescribed notice, must be given to the building owner “as soon as possible following signing”, citing section 28(1)(f). That notice is “Form 1 – Your Building Contract: Your Rights and Obligations”, found in Schedule 2 of the 2026 Regulations.

The Handbook also says “The contract should include a start and finish date, or at least an estimate of the number of days that it will take to complete the work.”

The September 2024 Form 1 notice also explains charging clauses, which give the builder “the right to lodge a caveat over the property”, and advises independent legal advice where an owner is not certain about one.

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How is the price set in a building contract?

A contract includes terms that describe how the price is calculated, the Law Handbook records, citing section 29. The Act as consolidated at 1 January 2024, an archived version that predates the January 2026 changes, required a domestic building work contract to stipulate a specific price and the terms of payment, subject to its rules on rise and fall and cost-plus clauses.

The September 2024 Form 1 notice says that where a price may change or is an estimate only, the contract must contain “THIS PRICE MAY CHANGE” or “ESTIMATE ONLY” adjacent to that price, and that more than one such price must be set out in a single list. It adds: “Those prices that are only estimates must be fair and reasonable estimates.”

The Handbook describes three kinds of price term, under the word “include”.

Lump sum: the contract states a specific price, although the cost of some elements may vary depending on the actual cost. The Form 1 notice says items designated “prime cost” or “provisional sums” may lead to a change in the total sum an owner can be charged. Variations sought by the owner must be agreed in writing.

Rise and fall: the cost moves up and down with the actual cost to the builder. The Handbook states “It is lawful to include a rise and fall clause if there is a completion date”. Consumer and Business Services’ price guide, which predates the November 2025 threshold change, says “any price increases cannot be made for work done after the agreed period” unless the contract allows for an extension of time, the delay was the owner’s fault or due to a cause beyond the builder’s control that the builder could not have expected, and the builder gave notice and completed the work as soon as practicable.

Cost-plus: the builder adds a margin to the actual cost of the building. The Handbook states “In South Australia the margin is limited to 15%.”

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What is the cooling-off period for a building contract in SA?

The Law Handbook states “A building owner has 5 clear business days after signing the contract in which to terminate the contract.” The September 2024 Form 1 notice and the archived 2024 Act measure that time from the making of the contract instead; Form 1 says “before 5 clear business days have expired after the making of the contract”.

The owner gives the builder written notice of the intention not to be bound, and the archived Act required the owner to sign it. The Handbook records that the contract is considered terminated at the time the notice is posted by certified mail or personally served, citing section 36(3).

It also records that the owner may terminate before completion if the builder has not complied with the relevant provisions of the Act, citing section 36(5)(b), and says that in this case “legal advice should be sought prior to cooling off, because there may be ramifications in relation to any unpaid work or legal costs incurred”.

Consumer and Business Services’ consumer guide of January 2025 says an owner can opt out during this period “without penalty; however, you may still be liable for any materials or services supplied by the builder before you terminated the contract”. It adds that the period “may be longer if the builder has failed to comply with some of the legal requirements for the contract”, giving a missing Form 1 notice or building indemnity insurance as examples.

The archived 2024 Act excluded minor domestic building work from section 36. The current deadline and how to serve notice are questions for a legal adviser before any notice is given.

Can a contract take away rights under the Act?

The Law Handbook records that it cannot. A building work 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.

The Handbook records that under section 38, if a contract contains terms that are harsh or unconscionable, a party may apply to the Magistrates Court for appropriate relief.

The Handbook says a building owner should read the contract carefully to find out how it might be varied. It also records that section 32 implies statutory warranties into every domestic building work contract, covered in a separate note.

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What about minor domestic building work?

Contracts below the threshold are minor domestic building work, and the Law Handbook says they are not subject to the same requirements. For example, it says “there is no legislative requirement to have a written contract or building indemnity insurance”.

Other protections remain. Builders and other trades must still be appropriately licensed, the statutory warranties in section 32 “apply whether or not the work is considered minor”, and the Australian Consumer Law also applies. The Handbook adds that a written contract “is still a good idea” so that both parties are aware of their rights and obligations.

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.