Anecdotally, one hears of scenarios where residential builders have “lent” their builders registration to other individuals who don’t have builder registration.
Why do they do it? I wouldn't have the foggiest idea. Maybe its to help out a mate, maybe there is a stipend, but whatever the case, it's a daft, very bad idea.
The "tom-tom drums" of the building industry beat a tale of woe where the ode of licence lending comes back to bite registered builders who engage in this naïve and misconceived practice. It appears that there are those who, armed with licence, nominate a mate as the registered builder apparently with the consent of the registered builder, and then with lofty dreams and limited experience, go about the business of building.
Not surprisingly the impostors - the "pop up builders" if you will - pretty quickly find out that they are out of their depth and the project goes of the rails. The project's demise can occur due to a whole variety of reasons: underquoting, poor workmanship, failure to complete the job, no understanding of the Building Code of Australia or a veritable potpourri of all of the above.
The pretender, or the "builder you have when you don't really have a builder," then disappears, the project goes down the gurgler and the victim (the consumer) finds a construction lawyer who then advises the aspiring home owner to go after the registered builder (the holder of the DBU number) who has the home owners warranty policy.
That’s when things get really bilious. The builder may say well my involvement was limited, was remote or abstract, but that won't cut the mustard because it's the registered builder who will be called to account.
If the pretender has done a runner or is devoid of funds, then all roads will lead to the bloke who had the brain explosion and let his mate make use of his or her domestic registration number. That will leave the licenced builder to fix up the mess or risk being sued.
If the insurer has to step in, then the insurer (the furnisher of the home warranty cover) when called upon to pay out will doggedly and relentlessly claw the monies back from the real builder courtesy of the counter indemnities.
Builders should never lend their registration to another. They should always assume full custodianship of every project they lend their name to by way of registration. It is incumbent upon a registered builder to have rigorous systems in place to control and manage every project that comes under his, her or its watch.
If the motivation is to help out a buddy by lending out one's registration, remember, "the road to hell is paved with good intentions." Of course, I would not say that lending out one's registration for the construction of a dwelling is well-intentioned, so the metaphor is not entirely on point.
The bottom line is this: if you are a registered builder, don't lend out your registration or DBU number, don't desert your post, keep control of your project, build well and on time and above all be the master of your own destiny.