AustraliaA builder went bankrupt before finishing my renovation. What consumer protections apply?
If your builder went bankrupt before finishing your renovation, you may be protected under the Australian Consumer Law (ACL) and state-based home building compensation schemes, which can cover losses up to $20,000–$100,000 depending on your state.
What the Law Says
The Australian Consumer Law (ACL) and state-specific home building legislation provide key protections when a builder becomes insolvent before completing residential renovation work.
The Australian Consumer Law (ACL), which forms Schedule 2 of the Competition and Consumer Act 2010 (Cth), prohibits misleading or deceptive conduct and guarantees that services—including building work—will be provided with due care and skill. If a builder takes payment but fails to complete the work, this may breach ACL sections 18 (misleading conduct) and 60 (acceptable quality of services).
In New South Wales, the Home Building Act 1989 (NSW) requires builders to hold home warranty insurance for residential building work over $20,000. This insurance covers incomplete or defective work if the builder dies, disappears, or becomes insolvent. Similar schemes exist in other states — e.g., Queensland’s QBCC insurance, Victoria’s Domestic Building Insurance (DBI), and WA’s Home Indemnity Insurance.
Eligibility depends on contract value, timing, and whether the builder was licensed and insured. Claims must usually be made within 90 days of discovering the insolvency or abandonment, and the work must be residential (not commercial).
Statutory TextA person must not, in trade or commerce, engage in conduct that is misleading or deceptive or is likely to mislead or deceive.
— Competition and Consumer Act 2010 (Cth), Sch 2 — Australian Consumer Law, s. 18
Statutory TextA person who supplies services to a consumer must supply the services with due care and skill.
— Competition and Consumer Act 2010 (Cth), Sch 2 — Australian Consumer Law, s. 60
Statutory TextThe contractor must hold home warranty insurance for residential building work valued at $20,000 or more.
— Home Building Act 1989 (NSW), s. 92 — Requirement for insurance
What to Do
Contact your state’s building regulator (e.g., NSW Fair Trading or QBCC) immediately to report the insolvency and check insurance eligibility.
Gather all contracts, invoices, progress payments, correspondence, and evidence of incomplete work.
Lodge a claim with the relevant home warranty insurer within 90 days of becoming aware the builder won’t finish the job.
Consider seeking urgent legal advice — especially if you’ve paid a large deposit or have a lien over unfinished materials.
Report misleading conduct (e.g., false promises about completion timelines or financial stability) to the ACCC or state consumer affairs agency.
Sources
Not legal advice. This article is general information based on publicly available sources, written for educational purposes. Laws change and individual situations vary. Consult a licensed attorney in your jurisdiction before acting on anything you read here. Last reviewed: 2026-06-08.