Be Product Aware When a faulty or defective product goes bad

17-02-2020

The range of building products currently available on the Australian market is larger than ever before, and growing more every day. This growth (particularly with many products being manufactured overseas) can make it difficult to verify the product quality, and if they comply with relevant standards.

Pressure is also mounting on builders to deliver more innovative building designs quickly and cheaply. It then becomes tempting for builders to ‘use now, ask questions later’.

Any building work in Australia needs to comply with the National Construction Code (NCC) which sets the minimum standard that building products need to meet. In addition, some building contracts have additional requirements for a higher standard of performance or longevity than what is set out in the NCC.

What happens if there’s an issue with a building product?

This really comes down to the product and how it’s being used;

  • The failure of an inferior product which causes property damage or lost-time due to business interruption, and;
  • A product which doesn’t comply with the NCC or the relevant contract.

As a builder, how are you covered?

Your builders insurance will generally cover the cost of repairing damage caused by a defective product and any compensation associated with lost time. However, finding insurance policies which cover the cost of replacing or upgrading the defective or non-compliant product itself is a different story. This can obviously be a large expense particularly when there are issues with services, cladding, and fire protection materials.

How to protect yourself as a builder

  • Don’t take their word for it: Whilst a product might boast many innovative claims, make sure you check the reliability and robustness of the evidence.
  • Avoid substitution: As the builder, the contract with the owner is with you. Before you substitute with products specified in approved design documents, do your own research to make sure the product is right.
  • Question your client: Even if your client is asking you to substitute a product, always exercise caution. It is the builder’s ultimate responsibility for ensuring that the products meet the requirements of the NCC.
  • Overseas manufacturers: Where possible, try to avoid procuring products direct from overseas manufacturers. The chances of recovering losses from an Australian-based supplier are much greater than recovering losses from an overseas jurisdiction.

In summary, remember that you as the builder hold the contract with the client, so if anything goes wrong with a product you’ve used, you are ultimately responsible. Ask questions and always do your research.

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