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Builders fined $40k over misleading conduct
Three builders have been fined a combined $40,000 after misleading home owners, insurers, and local authorities in an arrangement that bypassed mandatory insurance restrictions.
Danne Adam Forte, Ha-DecGroup and the company’s director, Hany Ayad, admitted to misleading conduct under the Building Services (Registration) Act 2011 following disciplinary proceedings before the State Administrative Tribunal (SAT).
The matters concluded through SAT mediation last month, with Forte fined $20,000, Ha-DecGroup $15,000 and Ayad $5,000.
The case centred on two homes in Joondanna and Pearsall, where home owners entered into project management agreements in 2020 for Forte to oversee building work.
At the time, Forte did not have access to home indemnity insurance (HII), which is mandatory before builders can carry out residential building work valued at more than $20,000.
Ha-DecGroup obtained HII policies for both projects and was named as the builder on the building contracts and permits.
However, the clients paid invoices to Ha-DecGroup, which transferred more than 90 per cent of the money to a company for which Forte was the sole director.
The SAT fined the parties for misleading conduct after finding Forte had “assumed the role of builder for the majority of works” despite not being the named building contractor.
The parties also failed to inform the insurer or local governments that Ha-DecGroup “was not the builder in control of the two sites”.
Forte has voluntarily surrendered his building contractor and building practitioner registrations, while Ha-DecGroup’s building contractor registration is no longer active.
Building commissioner Phil Payne warned builders against attempting to bypass insurance restrictions, saying the arrangement could affect home owners’ ability to make claims.
“The arrangements were an attempt to borrow access to an HII facility, which can affect a home owner’s ability to claim against that insurance policy later on,” Payne said.
“This conduct truly misled many parties – the home owners, the local government permit authorities, and the insurance provider.
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“Building regulations and insurance restrictions are implemented for good reason, including helping builders manage their project volumes and finances. Any attempt to bypass these measures can put consumers, and even building safety, at risk.”
Payne urged consumers to ensure the builder they deal with is also named on the building contract, HII policy and other official documents.
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