In response to the loss of pub­lic con­fi­dence from promi­nent design and build­ing qual­i­ty issues, the New South Wales (NSW) Par­lia­ment has passed leg­is­la­tion to fur­ther reg­u­late the design and con­struc­tion of res­i­den­tial build­ings.

 

What has hap­pened?

In June 2020, the NSW Par­lia­ment passed an inter­est­ing new piece of leg­is­la­tion, the Design and Build­ing Prac­ti­tion­ers Act 2020.

The leg­is­la­tion passed out­lines a ‘duty of care’ law, mak­ing all par­tic­i­pants in build­ing work respon­si­ble for fix­ing build­ing defects. The law aims to help cur­rent and future build­ing own­ers avoid eco­nom­ic loss caused by said build­ing defects.

 

Who will be impact­ed?

The new build­ing law will impact peo­ple who own and live in stra­ta build­ings and any per­son involved in prop­er­ty devel­op­ment and con­struc­tion in NSW. Many own­ers cor­po­ra­tions will now have rights they did not pre­vi­ous­ly have.

The new Act will cov­er exist­ing build­ings con­struct­ed in the last ten years and all new con­struc­tions going for­ward. It also applies to exist­ing build­ings if the loss caused by the defects was first appar­ent with­in the 10 years imme­di­ate­ly before the start of the new Act on the 11th June 2020.

 

Who is respon­si­ble?   

Any per­son who car­ries out the con­struc­tion work on a res­i­den­tial build­ing now has a duty to exer­cise rea­son­able care to avoid an eco­nom­ic loss to the cur­rent or future own­er.

The type of con­struc­tion work refers to:

  • Build­ing work;
  • Designs for work;
  • Man­u­fac­ture or sup­ply of a build­ing prod­uct used for build­ing work;
  • Super­vis­ing, coor­di­nat­ing, project man­ag­ing or oth­er­wise hav­ing sub­stan­tive con­trol over the car­ry­ing out of any of the above.

The con­struc­tion par­tic­i­pants refer to:

  • Builder and prop­er­ty devel­op­er.
  • All par­ties involved in the con­struc­tion.
  • Con­sul­tants includ­ing archi­tect, engi­neer, oth­er spe­cial­ist prac­ti­tion­ers, etc.
  • Super­vi­sors or project man­agers.
  • Indi­vid­ual sub-con­trac­tors and sup­pli­ers.
  • Pri­vate cer­ti­fiers (if they were an active par­tic­i­pant in con­struc­tion work or had sub­stan­tive con­trol over the car­ry­ing out of the build­ing work).
  • builders (includ­ing head con­trac­tors, sub­con­trac­tors, cer­ti­fiers and engi­neers)

Par­ties can­not con­tract out of the statu­to­ry duty of care.

 

What can be claimed?

Dam­ages that can be claimed include costs to rec­ti­fy, includ­ing con­se­quen­tial loss caused by defects, and also the costs of rea­son­able alter­na­tive accom­mo­da­tion (if nec­es­sary).

 

Actions own­ers, future own­ers or own­er cor­po­ra­tions can take: 

Pru­dent Stra­ta Man­agers should now under­take a defect review of all build­ings con­struct­ed with­in the last 10 years includ­ing build­ings that are out of time for a poten­tial statu­to­ry war­ran­ty claim under the Home Build­ing Act 1989.

 

Actions con­struc­tion par­tic­i­pants can take:

Ensure your build­ing prac­tices com­ply with the Build­ing Code of Aus­tralia.

Resolve any build­ing defects quick­ly and pro­fes­sion­al­ly in order to avoid poten­tial future claims.

 

Scott Williams is a Senior Lawyer at Dono­van Oates Han­naford who spe­cialis­es in con­veyanc­ing, prop­er­ty law and busi­ness law. Con­tact Scott today if you require legal sup­port in rela­tion to the above top­ic.

 

 

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