> Consumer advice  > Building or renovating a home  > Glossary

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• Building work
• Building work contractor
• Business day
• Buying off the plan
• Certificates of compliance
• Contract documents
• Cost-plus clause
• Display home
• Domestic building
• Door-to-door
• Energy efficiency
• Exclusion of rights
• Fixed price contract
• Fixtures
• Footing
• Form 1 (building)
• Form 1 (selling)
• Foundation
• Harsh and unconscionable
• Indemnity insurance
• Licensed tradesperson
• Licence number
• Minor domestic building work
• Owner-builder
• Practical completion
• Prescribed time
• Preliminary work
• Prime-cost-item
• Provisional sums
• Rise-and-fall clause
• Specifications
• Statement of compliance
• Statutory warranty
• Subcontract
• Surplus materials
• Variations

Building work

means the whole or part of the work of constructing, erecting, underpinning, altering, repairing, improving, adding to or demolishing a building; or the excavating or filling of a site for the above listed work or on-site construction work associated with a pool or spa and paving and fencing (excluding post and wire).

Building work contractor

means a person who carries on the business of performing building work for others; or a person who carries on the business of performing building work with a view to the sale or letting (whether by lease, licence or other agreement) of land or buildings improved as a result of the building work. It includes specified trades such as painting and decorating, bricklaying, carpentry and joinery, electrical, plumbing
and gas fitting, tiling, concreting, fencing, paving, etc.

Business day

means any day except a Saturday or a Sunday or other public holiday within the meaning of the Holidays Act 1910.

Buying off the plan

means that you will contract to buy a project home, apartment, or in some cases, sub-divided vacant land, before the plan has been certified by the local council and registered with the Land Titles Office. You will pay an initial deposit before any building work has commenced and then pay the balance when the home is completed.

Certificates of compliance

are issued by all registered workers on a project to certify that all works have been performed to relevant standards.

Contract documents

means all of the documents such as the contract, plans, specification, schedule, engineer's reports and any other documents signed at the stage of contract signing. Usually there will be a reference to the precedence (or order of importance) of the documents.

Cost-plus clause

means a provision for the builder to recover the actual cost for materials and cost for performing specified building work in the contract, together with an additional amount not to exceed 15% of that cost. Cost-plus clauses are not commonly used in South Australia

Display home

is a home built by a volume-builder building company and on view in a display ‘village' with other display homes.

Domestic building

work contract means a contract between a building work contractor and another person for the performance by the contractor of domestic building work (including any variation of such a contract), but does not include a subcontract for the performance of domestic building work.

Door-to-door

trading means the practice where a person goes from place to place, or makes telephone calls, seeking out consumers who may be prepared to enter into contracts for the supply of goods or services. That person or some other person then meets face-to-face with the consumer and enters into negotiations with a view to entering into
a contract.

Energy efficiency

refers to a package of practical environmental measures that emphasises environmental and affordability considerations.

Exclusion of rights

conditions or warranties Any purported exclusion, limitation, modification or waiver of a right conferred, or contractual condition or warranty implied, under the Building Work Contractors Act 1995 is void.

Fixed price contract

means a domestic building work contract that contains neither a rise-and-fall clause nor a cost-plus clause. It is generally referred to as a Fixed Price Lump Sum Contract.

Fixtures

are items such as bathroom suites, built-in wardrobes and kitchen stoves that are attached to the property and cannot be removed without causing damage.
They should be specified in the building contract to be included as part of your completed building.

Footing

means the concrete base (usually a 'raft footing').

Form 1 (building)

Form 1 Building Work Contractors Act Regulations 1995, Your Building Contract: Your Rights and Obligations, provides you
with information about your building work contract, your cooling-off rights, your warranty rights, building indemnity insurance, deposits and payments.

Form 1 (selling)

Form 1 Land and Business (Sale & Conveyancing) Act is used at the time of resale to reflect that the structure has been certified by a building supervisor. It also details your right to cool off and how you must go about serving a cooling-off notice.

Foundation

means the solid ground or base, natural or artificial, on which a building rests.

Harsh and unconscionable

term means a term or condition of a domestic building work contract that a party to the contract considers a Court would give relief to.

Indemnity insurance

is a policy of insurance carried by the building work contractor when performing domestic building work. It protects the home owner, under statutory warranty, against the risk of non-completion of the building work and/or failure to rectify faulty work if the contractor dies, disappears, or is declared bankrupt.

Licensed tradesperson

The Building Work Contractors Act 1995 requires any person who carries on the business of performing work for others to have a building work contractors licence. The licence should show the licence number, qualifications, and any restrictions on the type of work the building work contractor is licensed to perform.

Licence number

in relation to a licensed building work contractor, means the number assigned to the person's licence by the Commissioner for Consumer Affairs.

Minor domestic building work

means domestic building work performed, or to be performed, under a domestic building work contract at a cost to the building owner of less than $12,000, or domestic building work performed, or to be performed, by a building work contractor on the contractor's own behalf where the cost of the work would, if it were performed under contract, be less than $12,000.

Owner-builder

is anyone who takes on the job of managing their own residential building project and performs the coordinating and contracting roles usually undertaken by a builder.

Practical completion

means the stage at which the home is substantially fit for use by the owner. It is at this stage that the builder will hand over the home to the owner. A Statement of Compliance must have been provided to the relevant local government body.

Prescribed time

means the end of five clear business days after the making of the domestic building work contract or, if there has been a failure to comply with any of the requirements in relation to a domestic building work contract, the time of completion of the building work under the contract.

Preliminary work

contract means a contract that is collateral to or otherwise related to an existing or contemplated domestic building work contract. It provides for the performance of work that is preliminary or ancillary to the domestic building work that is or would be required to be performed under such a contract.

Prime-cost-item

means your building work contract may include the supply of certain goods and services, such as a kitchen stove or bathroom tiling. These items may be designated prime-cost-items, so that if the standard of goods you select is higher than that provided by your building work contractor, you may have to pay an additional cost over and above that provided for, plus a surcharge, which may be up to 15% of the cost of the item.

Provisional sums

mean the amounts your building work contractor has determined as ‘best estimates' of the cost of doing certain building work under your contract.

Rise-and-fall clause

means a contractual provision under which a price stipulated for performance of domestic building work may change to reflect changes in the costs of labour (including related overhead expenses) and materials to be incurred by the building work contractor for all or part of a domestic building contract.

Specifications

refer to the detailed lists of specific building material, appliances and fittings to be used in a building or renovation.

Statement of compliance

must be completed and signed by both the builder and the owner. The builder certifies that the work has been carried out to relevant standards and the owner certifies that the work performed is in accordance with the plans and specifications for which the original Development Approval was issued.

Statutory warranty

means a warranty arising under the Building Work Contractors Act 1995 or under part of the repealed Builders Licensing Act 1967.

Subcontract

for the performance of domestic building work means a contract for the performance of domestic building work for a building work contractor who is in turn obliged to perform the work under another contract. If a building work contractor and a person make an arrangement under which domestic building work at a site is to be performed in stages by the contractor under separate contracts, the contracts to which the arrangement relates will be taken to be a single domestic building work contract.

Surplus materials

Most building contracts are for the completion of building work in accordance with the contract (which includes the plans, specification, schedule, engineer's report and other relevant documents). Any material left over goes to the builder.

Variations

are documented changes to a domestic building work contract, requested by either party to the contract at a sum of money determined by terms of the contract.

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