- Customers led to believe they were building with Flexible Homes
- Contracts actually with third-party building contractors
- Flexible Homes entered liquidation in 2023
The former directors of Flexible Homes Pty Ltd have been fined a combined $50,000 by the State Administrative Tribunal, which found the now-insolvent builder engaged in conduct that was misleading during three building projects in Shelley, Piara Waters and The Vines.
The Tribunal ordered Pavreet Singh and MD Touhidul Islam Sunny to pay $25,000 each for the company's conduct, which are disciplinary matters under WA's builder registration laws.
According to agreed facts following mediation at the Tribunal in August 2024, Mr Singh and Mr Sunny were Flexible Homes' directors in 2021 and 2022 when it "represented to certain clients that it would be the builder of their respective houses" but in fact the company "intended for a third-party builder to be engaged" for this work.
The facts state Flexible Homes entered into preliminary work contracts that stated or implied it would be the builder for the resulting projects, which were actually contracted to other builders. Flexible Homes also processed the applications for building permits and home indemnity insurance (HII) on behalf of these third-party builders. The company issued invoices and received payments for the building work, as well as carrying out all customer contact and administration during the projects.
The facts show Flexible Homes entered into service agreements with other registered building contractors, whose details were on the HII certificates, building contracts and building permits for the three projects.
The third-party builders contracted or involved at the relevant sites were Kanbour Construction Pty Ltd (BC102920), Distinctive Building Services Pty Ltd (BC101172), Platinum Homes & Construction Pty Ltd (BC101914) and Sun & Gill Homes Pty Ltd (BC103891).
The facts state the Shelley homeowner engaged with Flexible Homes in late 2020 regarding a demolition and renovation, but the company's conduct caused an "undue delay" of at least eight months for the work to commence. On Flexible Homes' recommendation, the client signed a contract with a third-party builder only to be told months later this business could not obtain the required HII. Flexible Homes arranged for a second builder to be contracted, but another month passed before it was revealed this builder also lacked HII access. The client's final contract with a third builder was not signed until August 2021.
Flexible Homes also made contract variations involving demands for extra funds, potentially misleading clients into believing this was arbitrary by not explicitly explaining the reasons or that the source of the request was a third-party builder. Two price increases were also made without written justification or verification and the Shelley homeowner was asked for a progress payment when the corresponding work had not even started.
In another instance of misleading conduct, the facts reveal that while Mr Singh was Flexible Homes' director, he signed a building contract on behalf of a third-party builder that had not given him authority to enter into any contracts on its behalf.
Flexible Homes also failed to comply with a building remedy order, issued by the Building Commissioner, for damage to a house neighbouring the Shelley site.
Flexible Homes (BC103556, expired) entered liquidation in June 2023.
Building Commissioner Saj Abdoolakhan said the significant fine against the directors was a clear message that improper conduct has no place in the building industry.
"Homeowners rightly expect builders to act with integrity when they enter into contracts for what is usually the biggest purchase of their life," Mr Abdoolakhan said.
"Building contract laws protect consumers and ultimately help to ensure our buildings are safe and compliant. Attempts to mislead and sidestep these rules are unacceptable.
"I encourage consumers to thoroughly check all contracts and related documents to ensure the building contractor listed across the paperwork is the builder they know and are dealing directly with.
