Our experiences of CARE HOME IMPROVEMENTS (VIC) PTY LTD

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1 Rosanna 3084 Victoria 14 January 2010 Richard Willis Secretary, Council Committees Department of the Legislative Council Parliament House Spring Street East Melbourne, 3002 Phone: (03) (03) Fax: (03) Dear Richard Our experiences of CARE HOME IMPROVEMENTS (VIC) PTY LTD We signed the Contract with CARE HOME IMPROVEMENTS (VIC) PTY LTD on 12 April We were told by Mal Lethbridge - Managing Director, MD of CARE HOME IMPROVEMENTS (VIC) PTY LTD that his business was founded on more than 35 years experience, and that Care build quality work throughout Melbourne. I quote from the CARE HOME IMPROVEMENTS (VIC) PTY LTD website: - Our dedicated team of Management and Staff at Care Home Improvements provide a High Quality Service with all our Building Projects always ensuring that your project is built on time and within budget. Mal told us that Care only use reputable trades people who they have worked with for many years. This statement we discovered was a total fabrication. Neither the Site supervisor, nor the Carpenter (who was responsible for 75% of the renovation), the plumber or plasterer, assigned to our build had ever worked for Care Home Improvements before. What we discovered is that Mal Lethbridge asked various trades people to quote for the work and then he took the cheapest quote! Mal Lethbridge informed us that he was also a member of the Master Builders Association (MBA) and the Housing Industry Association (HIA). We called these bodies and asked about Care and if they where reputable and trustworthy, to which both organisations said No problems to report. This gave us comfort, as we thought we were protected in the event of a dispute. However, we have subsequently learnt that the MBA and HIA operate to protect the builder and not the consumer, and they do not act as a regulator in the building industry. When we experienced problems, we approached the MBA and HIA and had no joy. What we discovered is that Mal Lethbridge is not a Registered Building Practitioner. What this means is that he employs a Supervisor who is a Registered Building Practitioner, and it is through this Supervisor s license that Mal Lethbridge can operate. When the Supervisor resigned from Care Home Improvements, our building permit was suspended. It also explains why Mal Lethbridge never looks bad as his name as a Registered Building Practitioner cannot be tarnished! It s a shame we weren t informed of this fact by either the MBA or HIA. But we now also realize that having a Registered or Unregistered Builder does not matter because no

2 one will police their behaviour, in terms of completing or rectifying building work and no one will police their unprofessional and unethical conduct. This applies to whatever category of builder, be it registered or unregistered. So the Building Commission, CAV, HIA, MBA, all take no action against dodgy builders. Another selling point, which backfired was the fact that we had Building Warranty Insurance. We thought we were protected should anything happen. In fact, the insurance only comes into place should Mal Lethbridge die, disappear or become insolvent. The definition of insolvent means that Care Home Improvements Pty Ltd is removed from the register of ASIC (Australian Securities and Investments Commission). So the fact that Mal Lethbridge fails to pay his trades people and cannot complete a renovation project is irrelevant. So hence our insurance cover has been worth less than the paper it was written on. We have also approached the Building Warranty Insurance Company, who has said even if Care is removed from the ASIC register- we will have to sue them in order to receive any form of compensation. This is a very costly process and I believe something Mal depends and relies on. You see if it is too costly to prosecute then he will never get a judgement against him and thus never flag as a problem builder! Our relationship with Mal Lethbridge started to sour when the incorrect windows were ordered by Care. Mal promised us that the new windows installed in our extension would match the existing windows. When the windows were delivered they did not match. We discussed this issue with Mal who suggested we replace all the old windows with new ones, at our personal expense of an additional $12,000. He stated that the manufacturer did not make our style of window. This solution was unacceptable. Ironically, when our double window was replaced (as the original one was the incorrect size) the window manufacturer agreed to match our existing design at the request of Care Home Improvements. This confirms that the manufacturer could have made matching windows from the start; however due to an oversight by Care Home Improvements the correct windows were not installed. No apology was received from Mal Lethbridge. At Sub floor level (2 months into the project) we realised there were serious issues with Care Home Improvements. The Carpenter assigned to us, announced that he would no longer work full time on the build and he would be completing the remaining work on the weekends. At this stage, there was at least 2 months of full time work left on the renovation. From July to Mid August our Carpenter came every Saturday and Sunday from 8am to 6pm My husband was the Carpenter s labourer- as he was working alone on site and needed assistance to get things done in the available time e.g. installing new windows and doors to the existing part of the house required 2 people to get it done in a day and make the house secure for that night. In August, the internal structure was complete and ready for plastering. Four Plasterers were sent over a period of the next 6 weeks to quote for the work. One of them stated that he had previously worked for Care Home Improvements, but had not been paid so refused to plaster our house. During this time over 2/3 of our house was an open structure. My husband and I slept on a temporary mattress placed each night on our lounge floor. Our family lived in our lounge/ dinning room and a make shift bedroom for my two small children.

3 Our whole renovation came to a stand still in August- until the plastering was finished- no further work could be done. Our kitchen was totally removed and we were left without a kitchen for 2 months. With two small children this made life very difficult. When we complained to Care Home Improvements, James Lethbridge told us that we shouldn t complain because we had a roof over our head, more than could be said for some of his other clients! WHAT AN ADMISSION! Care Home Improvements offered no sympathy or empathy. No attempt was made to speed up the renovations. The plumber refused to finish our down pipes or install our two bathroom fittings, as he had not been paid. In August, we drew up a schedule of works in an attempt to hurry Care Home Improvements up. Our renovations were due to be finished at the beginning of September and we were months away from completion. We realised our attempts were futile when the Site Supervisor told us he was owed a large sum of money from Care Home Improvements. He also informed us that he was having great difficulty sourcing building materials, as Care Home Improvements owed most of their suppliers large sums of money and their account with most building suppliers throughout Melbourne had been frozen. Plasterers finally arrived in October, Care Home Improvements did not inform us that the Plasterers were starting mid week or what their requirements were. A plastering crew arrived and upon entering our house, informed us that they were not prepared to plaster unless every room was emptied. My husband had to rush back from work to help me move all our belongings into storage. For the next 4 weeks we lived out of suitcases and camped in the lounge of our own house. Care Home Improvements did not make any attempt to protect our wooden flooring. Again, it was left up to us to buy protective sheeting for the floors. Care Home Improvements do not care about their customers. Dealing with the Plasterers was one never-ending battle. Care Home Improvements had told the Plasterers that they would be provided with scaffolding to enable them to plaster the high stairwell. Care Home Improvements refused to do this, so the plasterer had to erect makeshift scaffolding. Simply put, Care Home Improvements do not care about their Trades People or Sub Contractors either. They only care about making lots of money. In attempt to speed the process along, we sourced an independent Stair Manufacturer, who we paid directly. They installed a beautiful hardwood staircase at a third of the price that Care Home Improvements had quoted us for a pine staircase - it seems that Care Home Improvements were willing to stop at nothing to make an extra buck. We also sourced all our bathroom tiles directly from various tile shops and paid for them ourselves. Both the staircase and bathroom costs were supposed to be refunded to us by Care we are still waiting! Of course, this will never happen.

4 We were forced to terminate our contract at the end of December. Our house was only 90% complete, but we had paid 100% to Mal Lethbridge We paid Care Home Improvements a substantial amount of money for our home renovation. The whole experience of dealing with Mal Lethbridge was a nightmare. He stole our money. He did not deliver any high quality service or provide a quality build that he openly states Care Home Improvements would on his website. Mal Lethbridge is a CONMAN- he does not provide you with excellent value for money. He is unethical and should not be allowed to operate. A year later we still do not have our dream home. Having been let down by Care Home Improvements and the bodies supposedly setup to protect consumers (however they only protect the builder) and given the costly legal system we have been forced to spend more money in order to complete our house. We went to the VCAT, only to find out that the VCAT process was very costly and set up for owners to lose lots of money. We also realised that it is a very lengthy process, which is very stressful. We had already paid over $1000 in solicitors fees and realised that this was just the beginning. So with the all these facts and exorbitant solicitors fees, we realised that we cannot win. The more we spoke to people we heard of people ending up divorced, or with heart attacks, just because of such nightmare experiences with VCAT that can go on for years and the end result is that the owners can only lose. The Whole System is set up for the Lawyers and Building Consultants to make a fortune. We therefore decided to abandon the VCAT route. We have also had endless battles trying to source certificates from Trades people and building suppliers who are not willing to co-operate, as they have not been paid by Care Home Improvements. The current system is unfair and a disgrace. The system lends itself to rogue builders like Mal Lethbrigde making a living out of conning innocent people. Re the Terms of Reference Point 1 Builders Warranty Insurance This insurance is absolutely meaningless there is a need for proper Home Warranty Insurance, which will protect consumers from dodgy builders. We did not receive Warranty policy until after we had signed the Contract so we did not have any idea of all the exclusion classes in the warranty. In Queenslandconsumers have First Resort Insurance that is what we need in Victoria, especially given the huge amounts of money involved (and owners can then claim for incomplete work and defective work). The Queensland model is linked to the builder s licence, so if the builder refuses to finish or fix work, he risks losing licence. Point 2 Governemnt Agencies eg the BACV, Consumer Affairs, Building Commission and VCAT. The BACV, Consumer Affairs and Building Commission all need to have some enforceable powers and then use them. At present BACV and the Building Commission cannot compel belligerent builders to conciliate or to rectify/complete work. I question the powers of the Building Commission because when I asked them to help me they just referred me to another Government body- so I just kept going around and around and eventually worked out that no one would help me. It was very frustrating. The Building Commission as it operates supports bad builders and ignores consumers. My experience is that none of the Government agencies will help consumers at all. What we really need is a

5 new body with a commitment and powers to clean up the industry or seriously reform the existing Building Commission with strong powers and new people. Consumer Affairs Victoria have known about Mal Lethbridge for years and had information that he was a dodgy and unethical person unregistered and with a bad record. But they do not alert homeowners. And why has something not been done about him? This government agency knows about his record, but he continues to go on conning more and more consumers. This is disgraceful! CAV is supposed to help and protect consumers, but it lets us all down. Point 3 Alternatives After my experience and what I have learnt speaking to other people who have been in similar situations, I think it would be good to adopt the Queensland model with proper Home Warranty Insurance. In this system, builders are made to rectify work or face being penalised. Not like in Victoria, where builders walk away SCOTTFREE! The system is financially very viable and has been running successfully for years. Victoria also needs a checklist of bad builders for consumers to check before building (in Queensland demerits against bad builders is on public record). As I mentioned previously, I telephoned the various bodies to see if there was any information on Care Home Improvements and there was not. Since then, I have found out that Consumer Affairs have been tracking him for a good many years, but weren t in a position to tell me upfront that he had previously had a record of conning consumers. I ask: Why is that? And why can he go on and on doing this? In Queensland, rogue builders are banned for life, whereas in Victoria rogue builders are rarely even suspended and almost never have their registration cancelled. If a builder goes broke, in Queensland he is banned for 5 years and if he has a second failure then he is banned for life. In Victoria Site Supervisors should also need a Licence and have to actually supervise work. Point 4 Other matters: The fact that Mal Lethbridge has done this before, demonstrates the totally inadequate laws He is very wealthy man through robbing consumers over a long period of time Master Builders Contracts favours builders and they all know they have upper hand Research has shown that it is common for builders to go broke (builders make up 45% of those who go bankrupt) and yet in Victoria there is no record of these builders. I have subsequently found out that Mal Lethbridge has a history of not paying the Trades people and Sub contractors. This is a common practice of bad builders, which is unfair on these workers and the consumers- as both end up worse off HIA and MBA membership means nothing There is no body to regulate builder s building practices (materials and workmanship), behaviour, ethics or charges. The Building Commission in only inquired into or prosecuted 72 building practitioners! Inspectors and Surveyors roles need to be changed they need to check more than the few items now required; they also need to be independent (most projects 81% in fact - employ private surveyors and many of these continually in the employ of the builder and they cannot act independently) CONCLUSION

6 The whole system needs a thorough overall and the government has a responsibility to act. The effects on the lives of owners are devastating. Meanwhile, the system supports BAD BUILDING PRACTITIONERS and encourages them to continue their rogue practices. By Jeanine Andrighetto a member of the Consumers Collective of Australia