The Senate committee ignored calls from legal and consumer groups for a government-run system to replace the private scheme, as it has in Queensland. Greens...
THE insurance company at the centre of a Senate inquiry and the Beechwood Homes collapse has had its executives sacked and its independent operations repossessed...
HOW WELL ARE YOU COVERED IF YOUR BUILDER DOES NOT PERFORM?
MANAGING RISK – AUSTRALIAN HOME OWNERS WARRANTY INSURANCE
Best practice in the Australian Building and Construction Industry - A State of Origin, head to head comparison of the NSW Suncorp-Vero/HIA consumer protection scheme compared to Queensland’s BSA scheme
“Real Property Constructions (RPC) Collapse” 8th Feb 2008
GOOGLE METER (“RPC/Beechwood builder collapse” of search results @ 17th August 2008)
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TIMELINE
Beechwood Homes
Day 0 - 13th May 2008
Impact - 300 un-completed homes and 400 deposits paid
Real Property Constructions
Day 0 - 8th Feb 2008
Impact – 233 un-completed homes and 87 deposits paid
Day 1 – (14th May)
Minister Burney urged clients of
Beechwood not to panic following the news the company had gone into voluntary administration.
Ms Burney said the administrator will know in 2 or 3 weeks time if they can find another builder to complete projects or return deposits.
If they can’t then home owners will be able to lodge a home warranty insurance claim.
Day 1 – (9th Feb)
The BSA opened across the weekend with 26 staff to contact affected consumers and advise them BSA administers an insurance fund (called the “Queensland Home Warranty Scheme”) which provides a benefit for specified losses associated with a contractor’s failure to complete a contract.
If work has commenced, the insurance benefit is, (subject to the terms and conditions of the policy), equal to the cost to complete the works, less any moneys you are still holding under your contract.
If work has not commenced, the insurance benefit is limited to, (subject to the terms and conditions of the policy), a refund of deposit paid.
(Day 2) 15th May
Vero has recognised the company as insolvent following the appointment of a receiver.
Vero regards this as the trigger for consumers to lodge claims for home warranty insurance a claim under the Home building Act.
Note: This is a unique precedent and hundreds of other claimants over the years ask why this has not been applied to them?
(Day 3) 16th May.
Minister Burney calls for calm
“It is important that anyone with a contract with Beechwood Homes does not cancel it.
(Day 10) 23rd May.
“Progress is being made to find a buyer to take over the Beechwood contracts.
“In the event that Beechwood is not sold, the home warranty insurer Vero has indicated that it is ready to get on with the job of having the homes completed”.
VICTIMS of the collapsed building company Beechwood Homes face a further three- to four-week delay in the resumption of construction of their homes because ...
Being those 580 that were having plans done at a cost of between $2,500 & $5,000 by Beechwood but without a contract or warranty in place so no insurance applies
Insurance a poor deal for home builders While the accepted premium-to-claim ratio for most consumer protection insurance is between 65 and 80 per cent, under the home-building warranty insurance scheme it is only 7%
VICTIMS of the Beechwood Homes collapse seeking to cut their losses and start from scratch have been told by the company's receiver they do not own the house plans they have paid for.
UP TO 1000 families and builders remain uncertain about the future of collapsed builder Beechwood Homes.
(Day 60) 12th July 2008
Beechwood homes victims get ray of hope Sydney Morning Herald HOME OWNERS and creditors connected to the collapsed housing company Beechwood Homes were given a flash of hope yesterday with an administrator's report ...
(Day 69) 21st July 2008
Beechwood sale deadline not today: Govt ABC Online - Australia The New South Wales Government has rejected reports collapsed building company Beechwood Homes will be liquidated if it is not sold by close of business ...
BEECHWOOD Homes, the collapsed NSW home-builder, has been sold to a family-owned business, Cavasinni Constructions.
Beechwood receivers Deloitte today said the business had been sold for an undisclosed amount with all assets, including existing land, buildings, contracts and copyright. It will be sold as a going concern to Resibuildco, which will be funded by Cavasinni Constructions and the Cavasinni family. The business will continue to trade as Beechwood.
(Day 78) 30th July 2008
Beechwood homes in new hands... Cavasinni Constructions has bought the assets of the collapsed project-home building company Beechwood.
(Day 87) 6th May
About 70% of clients affected by the failure of Sunshine Coast-based Real Property Constructions have had their homes completed or deposits refunded.
Mr Schwarten said all 207 complaints received by the Building Services Authority about RPC had been assessed and 140 finalised. “There are 35 jobs currently out to tender and another 13 have been sent to quoting builders,” he said
“Homeowners affected by RPC’s collapse just three months ago, the BSA has done a great job in finalising about 70% of people’s claims.”
Mr Schwarten said the value of claims under the warranty insurance scheme to date was $1.9 million.
The creditors of Beechwood will get nothing from this failure of $74.6 million, and they have every right to know what this entity was sold for as does the Senate Inquiry who is inquiring into Australia's Mandatory Last Resort Home Warranty Insurance Scheme as this sale is replacing the very warranty scheme the Senate is inquiring into.
Comment
Now that Beechwood has been sold it would appear the warranty insurance scheme will not apply in this instance and the homes will be finished under the existing contracts. If this is the case that may be a great scenario for the consumers if their homes are finished for the original contracted price, however that outcome remains to be seen as contracts are yet to be assigned and works are yet to start, and we certainly have no idea when they will be finished as some of the HIH collapse consumers are still waiting after 7 years.
The QBSA failure on the 8th Feb 2008 saw the instant implementation of their first resort warranty scheme and after only 12 weeks saw 70% of consumer claims satisfied. This is the scheme we have been advocating since the HIH collapse that the building community is still paying for.
The insurance industry could not even take responsibility for their own failure!
In an industry big enough that we measure the fiscal health on the nation on we are being made look as though we are all a bunch of rat bags, incapable of managing our industry and providing basic consumer protection in a timely manner such as the holistic Qld scheme
Both NSW and Victoria jointly introduced this BWI scheme back in 2002 and appear to have an obsession to maintain the status quo in the face of overwhelming evidence of its failure to provide anything like appropriate consumer protection let alone anything that resembles reasonable industry management so it would appear there can only be one conclusion and that is that possibly others are benefiting from its being, and this is why the Senate inquiry must compel Vero and HIA to appear before a public hearing
The responsible NSW Minister is the Hon. Linda Jean Burney who has stated on numerous occasions that NSW has an effective consumer protection framework which delivers protection for consumers who are faced with the collapse of their builder’s company.
Thank you Minister, but where is that effective warranty insurance protection?
The Current Senate inquiry should represent both the consumers and builders of this nation in this most serious of matters that has seen suicide, financial failures, and family breakdowns suffered by thousands of Australians, and yet the major supporters of the current arrangements number only 2 from the big end of town being Vero Insurance and the Housing Industry Association and they have refused to appear before the Senate inquiry with the latter referring to the process as a kangaroo court.
This vexed and controversial issue has seen over 30 inquires and reviews in the past 10 years plus the Productivity Commission inquiry handed down recently that described this warranty as a running sore and now we have the Senate Inquiry that as yet has not compelled the two pivotal players to appear before the committee at a public hearing.
The Builders Collective of Australia (BCA) is the amalgamation of all the various groups around the nation that formed in 2002 to fight the introduction of the Last Resort scheme and consisted of the NSW Be-Fair builders group, the Builders Collective, Home Warranty Action Group (HWAG) from the Illawarra region, the Central West Home Builders Scheme (CWHBS) from Orange, and The Housing Indemnity Action Group (HIAG) together with the Builders (WA) mutual Fund Limited (BMFL) both from Perth which had preliminary approval from the WA Government for this proposed Mutual at this link www.buildersmutual.com.authat was successfully scuttled by the Housing Industry association in favour of the Last Resort scheme we have today.
Consumers have now joined forces with the BCA to present a united front that will ensure reform of the consumer protection and industry management of the Australian Building Industry.
Home Owners Warranty 
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