Schedule 1B QBCC Act: Level 1 vs Level 2 Domestic Building Contracts (QLD)

What it is

Schedule 1B of the Queensland Building and Construction Commission Act 1991 is the consumer protection chapter of QLD building law. Any residential building contract priced at more than $3,300 must comply with Schedule 1B. The schedule mandates the form of the contract, the timing of disclosures, the limits on deposits and progress payments, and the cooling-off period. The QBCC publishes Level 1 and Level 2 template contracts that comply with Schedule 1B out of the box.

This is not optional paperwork. A residential builder who uses a non-compliant contract commits an offence and the builder cannot enforce the contract against the homeowner the same way a compliant builder can.

Level 1 vs Level 2

The QBCC splits domestic building contracts into two levels based on price.

Level 1: $3,301 to $19,999

Level 1 applies to minor renovations, extensions, improvements and repairs in the $3,301 to $19,999 range. The QBCC Level 1 Renovation, Extension and Repair contract is the recommended template. Schedule 1B requires:

• A signed written contract before work starts
• Full identification of the parties and the work site
• A clear scope of work and price
• A deposit cap of 10 percent
• Standard warranties and termination rights

Level 1 contracts have fewer mandatory disclosures than Level 2 but the same core consumer protections.

Level 2: $20,000 and above

Level 2 applies to any residential building work priced at $20,000 or more, including new home construction and major renovations. The QBCC offers two Level 2 templates: the New Home Construction contract for new builds, and the Level 2 Renovation, Extension and Repair contract for existing dwellings. Schedule 1B requires:

• Consumer Building Guide given to the homeowner before they sign
• Signed and dated contract delivered to the homeowner within 5 business days of execution
• Plans and specifications attached
• Commencement notice within 10 business days of work starting
• Deposit cap of 10 percent for new construction or 20 percent for renovations
• Mandatory progress payment stages
• Cooling-off period of 5 business days from receipt of the signed contract

The homeowner can terminate during the cooling-off period and recover all but $100 of any monies paid (plus reasonable costs).

Mandatory disclosures under Schedule 1B

Schedule 1B requires the builder to disclose certain matters before the homeowner signs. The key disclosures are:

Consumer Building Guide

The QBCC-published Consumer Building Guide must be physically given to the homeowner before contract signing. Email or website link is not sufficient unless the homeowner has agreed in writing to electronic delivery.

Statutory warranties

The nine statutory warranties under section 13 of Schedule 1B must be set out in the contract. These warranties cannot be contracted out of.

Prime cost and provisional sum items

Each PC and PS item must be itemised with a reasonable estimate. The contract must explain how variations to PC and PS items are calculated.

Insurance

The contract must state the builder is covered by the Queensland Home Warranty Scheme and the policy is paid for separately by the homeowner before work starts.

Consequences of non-compliance

A builder who uses a non-compliant contract commits an offence under section 14 of Schedule 1B. The maximum penalty is 80 penalty units (currently about $12,896). More damaging is the practical effect:

• QBCC may issue fines, prosecute or take disciplinary action including demerit points
• The builder cannot recover progress payments in the same way against a non-compliant contract
• A QCAT building dispute hearing will treat the non-compliance as evidence against the builder
• Repeat breaches stack toward the 30 demerit point threshold for licence suspension

Where TradeLens fits

TradeLens checks contract-specific risks. If a Level 2 build is using a non-QBCC template, or the Consumer Building Guide step has been skipped, TradeLens flags it before the work starts. Schedule 1B compliance is one of the few areas where the documentation is the compliance. Get the contract right and a large category of risk goes away.

Practical advice

• Always use the current QBCC template unless your lawyer has reviewed and adapted it
• Treat the Consumer Building Guide hand-over as a step in your sales process, not an afterthought
• Have the homeowner sign and date a receipt for the Guide
• Diarise the 5-business-day cooling-off and the 10-business-day commencement notice
• Keep a contract file with all variations, PC and PS adjustments and notices in chronological order

The contract is the spine of the project. A messy Schedule 1B file makes every subsequent dispute harder to defend.