A Perth-based Western Australian construction company has lost its operating licence following a regulatory ruling over a small net negative equity position, but the firm is pushing forward with plans to appeal the decision and deliver on its outstanding residential projects.
Buildsmart WA, which has operated in Western Australia’s construction sector for 12 years, currently has six half-finished residential properties left in its project pipeline. Last week, the State Administrative Tribunal upheld a prior decision from WA’s Building Service Board to revoke the firm’s building registration, a move that was first proposed two weeks earlier on financial grounds.
Regulators targeted the builder after an analysis of its finances found a net assessable position of negative $4,779.74, alongside a cash flow deficit exceeding $48,000. WA’s building commissioner argued the company failed to provide sufficient evidence that it could meet its outstanding debt obligations as they came due, a mandatory requirement for retaining a valid building licence in the state. In response, Buildsmart WA has pushed back, noting that outstanding client payments owed to the firm are projected to exceed remaining construction costs by more than $540,000.
Following the tribunal’s ruling, the company released an official statement acknowledging the outcome but confirming its intention to launch an appeal. “While we are disappointed with the outcome, we intend to pursue an appeal,” the statement read. “Our priority remains our clients and the successful progression of homes currently under construction. For 12 years, Buildsmart WA has proudly operated in Western Australia, navigating a number of challenging periods for the building industry and committed to the clients and communities we serve.”
The licence revocation carries immediate practical consequences for the firm: it is now prohibited from undertaking any construction work that requires a building permit, or any project valued at $20,000 or higher. In the wake of the ruling, Building Commissioner Phil Payne advised homeowners who have ongoing or incomplete contracts with Buildsmart WA to reach out to QBE, the industry’s insurance provider, for support.
Payne emphasized that the tribunal’s decision, which came after an in-depth review of extensive financial and expert evidence, validated the Building Service Board’s original assessment. “Registration renewal is not a rubber stamp,” Payne said. “Builders must be able to demonstrate, with accurate, complete and timely financial information, that they have means to complete their building contracts and pay their debts as and when they fall due.”
The case comes as Western Australia’s construction sector continues to navigate widespread financial pressure, marked by volatile material costs and shifting demand that has pushed a number of smaller building firms into insolvency or regulatory action in recent years.