What is a Major Domestic Building Contract, and when is a builder legally required to use one?

A Major Domestic Building Contract is a written agreement for domestic building work where the contract price exceeds $10,000. It identifies the parties, scope of work, price and payment structure, and commencement and completion timing, and includes the mandatory consumer protections and notices under the Domestic Building Contracts Act 1995 (Vic). Where the contract price for preliminary work is less than $10,000, the parties are not required to enter into a Major Domestic Building Contract, though the agreement must still be in writing and comply with Part 2 of the Act. Where the contract sum for preliminary work exceeds $10,000, the parties must enter into a Major Domestic Building Contract.

What are my rights if my builder goes bust or experiences major construction delays?

If your builder becomes insolvent, your main protections are domestic building insurance (DBI) and your rights under your building contract and the Domestic Building Contracts Act 1995 (Vic). For work above the insurance threshold ($16,000), you should stop further payments, obtain and review the DBI certificate, and lodge a claim for loss of deposit and reasonable completion or rectification costs. You can check builder insolvency via ASIC or the National Personal Insolvency Index. If your builder is still trading but delayed, your rights come mainly from the time and delay clauses in your contract and the extension-of-time rules in the Act, potentially including liquidated damages, general damages, or termination in more serious cases.

Attorney for construction dispute

Q: What do the new 2026 Victorian building laws mean for contract deposits and statutory insurance?

The 2026 reforms introduce stricter controls on how builders can receive payments under domestic building contracts and replace the previous 'last resort' insurance model with a new 'first resort' scheme. Deposit limits, progress-payment stages and limits can be set directly in regulations, and payments must be proportionate to work actually completed. Cost escalation clauses are permitted in larger contracts (generally over $1 million) but capped at 5% with extra consumer protections. The reforms also establish a single statutory insurance scheme administered by the Building and Plumbing Commission, consolidating the former VBA, DBDRV and VMIA insurance functions, with the new first-resort Home Warranty cover responding earlier to claims from 1 July 2026.

How we can help

Construction projects are document-heavy and can be unforgiving. Building contracts often stretch to hundreds of pages, Security of Payment (SOPA) claims move on tight 10-business-day windows, and the record kept across the job usually decides the outcome of anything that gets contested later. For a construction business, getting the legal side right from project start is what keeps your margins in check, and prevents disputes from getting out of hand.

We act for principals, developers, head contractors, subcontractors and consultants across the full project lifecycle: drafting and negotiating the contract at the start, advising through delivery on variations, claims and contract administration, and where necessary, running disputes, including SOPA adjudications, defects, delay and disruption, latent conditions, design responsibility, terminations and owners corporation matters.

Building Contract Drafting and Advice
Owners Corporation
Building and Construction Litigation
VCAT Building Disputes
Building Appeals Board Disputes
SOPA Claims (Security of Payment Act)

Building Contract Drafting and Advice

We assist our clients in drafting new contracts, reviewing and advising on existing contracts, and providing termination advice when a contract is no longer tenable.

We act on design-and-construct, construct-only, engineering-design-construct, consultancy, operation-and-maintenance, joint-venture, consortium, alliance and ECI contracting, and domestic building contracts. We also advise on termination when a project is no longer tenable, on either side.

What we do

Drafting new construction and infrastructure contracts

Review and advice on existing contracts

Termination advice, i.e. terminating a contract or facing termination

AS, AIA and MBA standard form review and adaptation

Special conditions drafting and negotiation

Design and construct, consultancy and JV contracts

Alliance and ECI contracting structures

Domestic building contracts for builder side

Discuss your matter

Owners Corporation

We have a significant Owners Corporation practice and regularly act for Owners Corporations, managers, committee members, lot owners, builders and developers across a full range of OC work and disputes including establishment, rules, common property licences, major-repair decisions, manager removal, debt recovery, insurance disputes and Domestic Building Warranty claims.

If you own a lot in an apartment, townhouse or strata development, issues can arise with the owners corporation, the manager, other lot owners, or the building itself. Disproportionate levies, decisions made without proper process under the Owners Corporations Act 2006 (Vic), building defects affecting common property or your lot, and by-law disputes are the most common.

We act for lot owners on OC matters: advising on your rights, raising concerns with the OC or manager, lodging applications to VCAT, and defending claims brought against you.

What we do

Establishment of Owners Corporations

OC rules drafting, review and enforcement

Licences and leases over common property

Major repair, maintenance and special-levy advice

Service agreements building management and concierge

Stratum and company-title conversions

Manager tendering, changeover and removal

Building defects and Domestic Building Warranty claims

Debt recovery for unpaid levies in VCAT

Insurance claim disputes

Discuss your matter

Building and Construction Litigation

We act for principals, developers, head contractors, subcontractors, consultants and owners on variations, delay and disruption, defects, latent conditions, design responsibility, contract termination, SOPA matters, and bond and retention disputes. Where commercial settlement is in play, we explore your best options.

Our team has experience in negotiation, mediation, expert determination, adjudication under the Security of Payment Act, arbitration, and litigation in Victorian courts and VCAT.

What we do

Variation, delay and disruption claims

Defects and latent condition disputes

Design responsibility and consultant claims

Contract termination and breach claims

Security of Payment Act adjudications

Bond, retention and security disputes

Mediation, expert determination and arbitration

Litigation in VCAT and Victorian courts

Discuss your matter

VCAT Building Disputes

VCAT’s Building and Property List hears Victorian building disputes over defects, payment claims, contract issues, variations and delays. The List sits under the Domestic Building Contracts Act 1995 (Vic) for domestic work, which first runs through the DBDRV conciliation process.

As experienced VCAT building dispute lawyers, we act for builders, owners, subcontractors and consultants from initial application through to contested hearing including DBDRV appearances, expert evidence coordination, and the strategic decisions about which claims to run and which to compromise.

If you’re in a domestic building dispute due to defective building work or incomplete work, delays, overcharges, or work that doesn’t match what was promised, our dispute resolution lawyers can guide you through VCAT’s Building and Property List. This is the usual forum for resolving defect disputes under the Domestic Building Contracts Act 1995 (Vic). DBDRV requires conciliation first, with matters only proceeding to VCAT in the event that they do not resolve.

We act for homeowners in VCAT proceedings from application or response, through the expert-evidence stage, to a contested hearing. The technical evidence (building-expert reports, scope of works, costings) is often pivotal in deciding the outcome, and the way that evidence is prepared matters.

What we do

VCAT applications and responses in the Building and Property List

Building defects claims and defences

Payment and variation disputes

DBDRV conciliation appearances

Expert evidence and Scott Schedule preparation

Contested building hearings to final determination

Settlement negotiation at any stage

Discuss your matter

Building Appeals Board Disputes

The Building Appeals Board (BAB) hears appeals against Victorian building-surveyor and statutory-authority decisions under the Building Act 1993 (Vic), and resolves disputes between owners, builders, surveyors and adjoining owners. If you have received a building notice, a building order, or a Direction to Fix that you do not agree with, you have a limited window to appeal it.

As leading attorney for construction disputes we advise our clients on the full range of BAB matters.

We also act for Victorian homeowners and adjoining owners in BAB matters: appeals against Directions to Fix, building notices and orders, protection-works disputes where neighbouring building work is affecting your property, and disputes with building surveyors about decisions made on the project.

What we do

Appeals against Directions to Fix

Building permit, notice and order appeals

Protection-works disputes between adjoining owners

Termination of building surveyor appeals

Section 160A compliance determinations

Disputes between owners, builders and surveyors

Building Appeals Board hearing representation

Discuss your matter

SOPA Claims (Security of Payment Act)

The Security of Payment Act gives contractors, subcontractors, suppliers and consultants a fast statutory route to be paid for construction work. The timeframes are tight with the payment schedule requiring to have been served within 10 business days, and an adjudication application within a further 10 business days, or the claim fails procedurally.

We act on either side of a SOPA claim with our work including preparing payment claims, drafting payment schedules in response, running adjudication applications and responses, and enforcing or setting aside adjudication determinations through the Victorian Supreme Court.

What we do

Payment claim preparation and service

Payment schedule drafting and response

Adjudication applications (claimant side)

Adjudication responses (respondent side)

Enforcement and set-aside of adjudication determinations

Strategic advice on SOPA vs. other recovery routes

Judicial review of adjudicator decisions

Discuss your matter

Frequently Asked Questions

Disclaimer : The information contained in these FAQS is of a general nature only and does not constitute legal advice. It has been prepared by KPA Lawyers without considering your specific objectives, circumstances or needs, and should not be relied on as a substitute for tailored legal advice.

If you win your case and the court orders the other party to pay you the amount awarded (such as damages or debt owed) plus your costs, but they fail to do so, that debt does not disappear. Instead, the amount you are entitled to becomes an enforceable judgement debt, and you are permitted to use formal court procedures to pursue it from the other party. A judgement debt remains enforceable for six years, and there are several ways to recover it, including orders to seize property, garnishing wages or bank accounts, or summonsing the debtor to court to give an account of their financial position. KPA Lawyers are here to advise you on the most effective enforcement options for your situation and guide you through the relevant steps to recover what you are owed.

Generally, you must first make an application to Domestic Building Dispute Resolution Victoria (DBDRV), which is now operated by the Building and Plumbing Commission (BPC), and obtain a certificate of conciliation before commencing VCAT proceedings against your builder. There are limited statutory circumstances where you can proceed without obtaining a certificate, including for applications seeking an urgent injunction or where the dispute does not fall within the statutory definition of “domestic building work” dispute within the meaning of the Domestic Building Contracts Act 1995 (Vic).

A Major Domestic Building Contract is a written agreement for domestic building work where the contract price exceeds $10,000. It identifies the parties, scope of work, price and payment structure, commencement and completion timing and includes the mandatory consumer protections and notices under the Domestic Building Contracts Act 1995 (Vic) (‘DBC Act’).

Where the contract price for preliminary work is less than $10,000, the parties are not required to enter into a Major Domestic Building Contract. However, the parties should still record their agreement in writing and that agreement must comply with the requirements in Part 2 of the DBC Act including provisions dealing with escalation clauses and limits on the deposit.

Where the contract sum for preliminary work is more than $10,000, the parties must enter into a Major Domestic Building Contract.

If your builder becomes insolvent (goes bust), your main protections are domestic building insurance (DBI) and your rights under your building contract and the Domestic Building Contracts Act 1995 (Vic) (‘DBC Act’). For domestic building work above the insurance threshold ($16,000), you should immediately stop any further payments to the builder, obtain and review the DBI certificate and lodge a claim for loss of deposit and the reasonable cost to complete or rectify the works. You can check whether the builder is formally insolvent by searching the company on the ASIC website or, if the builder is an individual, by using the national bankruptcy search (the National Personal Insolvency Index). If the builder is insolvent, you will usually need to engage a new builder to complete the remaining works and rectify any defects, and it is important to keep clear records of all completion and rectification costs to support your insurance claim.

If your builder is still trading but experiencing major construction delays, your rights mainly come from the time and delay clauses in your contract and the rules in the DBC Act regarding extensions of time. You can insist that the builder strictly follows the contract’s notice requirements for any extension of time, challenge extension claims that are not properly notified or supported, and, if completion goes beyond the agreed date without a valid extension, claim liquidated damages (if your contract provides for them) or general damages for delay. In more serious cases, you may have a right to terminate the contract, keep your right to claim damages, and then take the dispute to DBDRV and, if needed, to VCAT to pursue completion and compensation.

The 2026 reforms to Victorian domestic building laws introduce stricter controls on how builders can receive payments under domestic building contracts and replace the previous “last resort” insurance model with a new “first resort” scheme.

Under the new legislation, deposit limits, progress‑payment stages and progress‑payment limits can be set directly in regulations, and payments for completed work must be proportionate to the value of work actually carried out. Cost escalation clauses are permitted in larger contracts (generally those over 1 million) but any increases are capped at 5% of the contract price and subject to extra consumer protections.

The reforms also establish a single statutory insurance scheme, administered by the Building and Plumbing Commission (BPC), which brings together the former Victorian Building Authority (VBA), Domestic Building Dispute Resolution Victoria (DBDRV) and the domestic building insurance function previously delivered through VMIA. As of 1 July 2026, the new first‑resort Home Warranty cover can respond earlier to claims for lost deposits, incomplete works and non‑compliant or defective domestic building work, rather than only responding when a builder dies, disappears or becomes insolvent.

In Victoria, you can generally pursue a claim for structural defects up to 10 years from the date of the occupancy permit or the certificate of final inspection. This reflects the strict 10‑year limitation period for bringing “building actions” under s 134 of the Building Act 1993 (Vic).

Why KPA Lawyers for Building and Construction

The firm that puts your outcome first

We combine senior expertise with genuine care, your matter will be handled by an experienced lawyer every step of the way.

Senior lawyers on every matter

A senior lawyer is involved at every stage, working alongside our wider team to ensure your matter is handled the right way.

Work with recognised experts

Pela, our Senior Associate, set a legal precedent in a building and construction owners corporation matter.

Three conveniently located offices

Visit our Sandringham or Mornington offices or meet with us in the Melbourne CBD, whichever location is most convenient for you.

KPA handled our business sale with precision and care. They explained every step clearly and achieved a result we were truly happy with.

Business owner, Melbourne · commercial Law client

Client Stories

What our clients say

After a difficult family separation, KPA handled every aspect of my matter with real sensitivity and skill. They took the time to understand what mattered most to me and delivered an outcome I am truly grateful for.

Michelle K.Family law, Mornington Peninsula

Firstly, I wanted to say that our team at Invescasa has been very impressed with the support and service you have provided thus far. As our business grows, we seek to partner with highly experienced conveyancing professionals who can help us deliver exceptional service, advice, and outcomes for our clients. We believe you could be a valuable part of that process

CEO, InvescasaProperty Law

We used KPA for our property settlement and could not be happier.The team were professional and efficient, and genuinely cared about our outcome every step of the way.

Sarah & Mark T.Property settlement, Sandringham

The KPA team guided us through a complex commercial lease negotiation with genuine confidence and expertise. I would highly recommend them to any business looking for reliable,knowledgeable legal support.

James L.Commercial leasing, Melbourne CBD

Our Team

The Building and Construction TEAM

You get direct access to senior legal minds who actively steer your strategy, giving you the clarity and financial certainty you need to move forward with confidence.

Pelagie Hebert

SENIOR ASSOCIATE

Pelagie plays a key role in the firm's building and construction practice as part of KPA Lawyers' Litigation...

View profile

Jacob Gown

ASSOCIATE

Jacob practcies in the areas of owners corporations disputes, insolvency, and commercial and general litigation, with appearances across...

View profile

Sabrina Smith

LAW GRADUATE

Sabrina is a graduate lawyer in the Litigation team at KPA Lawyers.

View profile