Plaintiffs love to sue building surveyors, and a great many builders have a habit of joining building surveyors as third parties.

Even though a search of case law will reveal a number of  decisions where building surveyors have been found “guilty” as it were, they seem to have become “claytons defendants” or “the defendants you have when you don’t have a defendant.”

Building surveyors are popular defendants because they are principal actors involved in every building project in the state of Victoria. They issue the building  permit, carry out the inspections and issue the occupancy permits or the certificates of final inspections. The north of three-storey exemption where you can’t sue builders (this exemption is under review in many jurisdictions) hasn’t helped either, for it has meant that absent the ability to pursue warranty cover in builder insolvencies, building surveyors are sized up.

The legislature intended that building surveyors play an important, if not critical role in the enforcement of building regulations. However, the legislature never contemplated that building surveyors would become the fall guy for all things that found wanting in the as built product.

This may come as a surprise to some plaintiff lawyers, who adopt a pretty cavalier approach to suing building surveyors.  Hopefully, aspirational litigants will learn enough to ensure that when they decide to have a crack at a building surveyor they doing so on in circumstances where the cause of action is built on very solid foundations.

In my 29 years of construction law experience, the basis of many a lawsuit against building surveyors is misconceived. Contrary to popular belief, building surveyors are not arbiters of good taste, and here’s where Senior Member Davis has come to the rescue, stating precisely that which building surveyors do not do.

“A building surveyor/building inspector is not engaged ‘to design, construct, project manage, act as a site foreman, clerk of works, supervisor for any part, of any construction process,'” he noted. “The building surveyor does not have any overriding duty but has a specified, finite responsibility to ensure compliance with minimum standards of the Building Code.”

It should also be borne in mind that building surveyors can also rely upon section 238 compliance certificates issued by prescribed classes of building practitioners such as engineers or building surveyors that certify that the work complies with the relevant aspect of the BCA. As long as the reliance upon the compliance certificate is in good faith, the building surveyor enjoys a statutory immunity and is exonerated from liability that is attached to the misconceived issue.

One of the paramount roles of a building surveyor is to carry out a final inspection and issue an occupancy permit when the owner or the builder considers the building work is completed. But here’s the thing: just because the building surveyor issues an occupancy permit doesn’t mean at law that the building surveyor assumes the liability for a whole host of defective work related sins.

Section 46 of the Building Act is very carefully worded and provides that an occupancy permit is “evidence that the building or part of a building to which it applies is suitable for occupation…but is not evidence that the building or part of a building to which it applies complies with this Act or the building regulations.”

The legislation is quite clear in emphasising two key points:

  • an occupancy permit is issued when the building is suitable for occupation
  • an occupancy permit is not evidence that the building work complies with the Act

Senior Member Davis hammered this point home in said case when he opined that “it is not the role of the a building surveyor or inspector to assure for aesthetics, quality, durability, reliability of workmanship on behalf of the owner and/or the builder. Weatherproofing, waterproofing are specific issues dependent upon quality workmanship and the reliability of products, these are the responsibility of the builder and product manufacturer.”

After all, under Acts of Parliament like the Domestic Building Contracts Act, there are statutory warranties that make it crystal clear that the builder has to build well and warrant the quality and the suitability of the as built product.

You may wish to read Senior Member Davis’ findings and seminal utterances very, very carefully because they are quite profound. Profound in the sense that if anyone is intent upon joining “the defendant you have when you don’t have a defendant” on the basis of a whim or a misconceived “industry practice,” then member Davis’ findings should give one pause. The last thing a consumer wants is to issue proceedings against a building surveyor when the grounds to do so are shallow, as costs may be visited upon the unsuccessful plaintiff.

  • This is a very topical article at the moment and also very relevant to Builders seeking to join the Building Surveyor to defect claims as co-respondents. Not saying it should not be done, but don't assume that the primary respondent will not remain as the Builder responsible for the construction.

  • A clarification – when reference is made to the north of 3 story exemption in the piece, the position is that one can`t sue insurers under home warranty cover for building cases if the development is higher than 3 stories, in circumstances where there are separate residences on each story. But one can indeed sue builders. It is also important to note that a number of governments are currently reviewing the exemption that dictates that warranty cover is not required for buildings north of 3 stories. So whether the exemption remains is yet to be seen. As it stands it follows that building surveyors are bearing a disproportionate burden of liability particularly in circumstances where an uninsured builder is rendered insolvent

    • Interesting article thanks Kim. I was discussing this very issue with a classroom full of future potential builders the other day in relation to a recent (and ongoing) case which the media has given some attention to. In this instance the apartment developer was also a local councillor and the certifier was his local council. In one of our now regular 'east coat low' weather events part of the roof of this apartment building decided to become detached. Initially,the insurer tarped up the gaping hole where the roof used to be and was preparing to initiate remediation works but pulled the pin when an expert determination found that the roof structure tie down was non compliant to NCC and AS/NZS requirements for the wind load exposure. The insurer rolled up the tarps and left the owners residences to become more damaged for months on end. I think the owners corp decided to fund the repair works themselves (hundreds of thousands of dollars) and hope to recoup these costs against other parties including the developer. All in all an abject lesson in terms of the regulatory failure masquerading as consumer protection legislation under the Home Building Act in NSW and probably similarly dysfunctional in our other states.
      Oh and by the way. Don't bet the house on the law changing re the specific exemption on warranty insurance for apartments north of 3 storeys. There's some significant $ donations that flow to both sides of our political parties from certain developers who have a vested interest in making absolutely certain that it never happened in the first instance and will never happen in the future!

  • A great article as usual but also useful in exposing a non-existent third key point, a vacuum or a gigantic black hole.
    There is nothing in the legislation to protect owners from, non-compliance, non-conformance and poor workmanship. Yes there are implied warranties in section 8 of DBCA1995 and a display home standard in section 6 but there is no enforcement regime. Homeowners are entirely at the mercy of the builder and are playing a Russian Roulette with the biggest investment of their life.
    We are supposed to be a first world country but our building stock is built without a legislated quality control system. Whilst Dr.Wild's vision of a Very Fast Train remains but a dream our reality is that building without production control we are fast tracking to a third world country status.
    Is that what we have to thank for to our legislators? Or is it just the con of the century against homeowners?

    • Whilst there is no legislated QA scheme, it is a source of bemusement to me that someone who would not sell a house with using an agent or buy a house without having it inspected would build a house without employing the services of a representative. In larger scale construction, clients employee project management firms for the specific skills they provide, which are the same skills they lack amongst which is the ability to inspect works and have some idea of what they are actually looking at. Home owners do not need to be at the mercy of home builders. They need to act to be proactive in ensuring they get what they are paying for.

  • Thanks for getting this out in the open Kim,..

    But could you clarify the liability of the Building Surveyors as to their important role in the acceptance of soil report findings where these reports have totally ignored Appendix D of the Code AS 2870 and not insisted on the history of trees in the immediate past on the applicable land allotments? I see the possibility of considerable liability in such circumstances… with building surveyors having the final say on this matter.

    • In my experience, as a D&C contractor, I have always had my engineer's design peer reviewed by a second (independent) engineer and certified with form 14. Under such circumstances, I have never had any problems in getting building surveyor to accept the engineering design. Building surveyor faced with an application supported by two certificates would quite rightly be able to rely in good faith on the certificates and issue a building permit without a chance of liability.
      So it seems that soil report is merely information that engineer relies on in engineering design and is not something Building Surveyor would concern himself with.
      In my view, any Building Surveyor that accepts engineering design without independent review by a second engineer and form 14 has rocks in his head and could become liable for acting outside his area of expertise.
      I hope this clarifies the position of Building Surveyor in relation to soil test.
      All of the above is still contingent on the duty of care.

  • Thanks for your poignant article Kim on the case of Lewis v Threadwell [2004] VCAT 547 (2 April 2004) which is a seminal authority of the job title of a Building Surveyor! Your article is very very educational and all Building Surveyor's would be well-advised to read this article and share it amongst their peers. It is a must read because the case makes clear what the role of a Building Surveyor is, viz-a-viz is not.

  • Excellent article Kim.

  • Given all that goes into a building, the idea that the building surveyor is somehow responsible for the whole lot is basically ridiculous.

    The example of weatherproofing given above is a case in point. To expect a surveyor to somehow attest to the full reliability of things like waterproofing membranes would be well beyond what they could reasonably be expected to do.

    • Excellent point Roger. The function of Building Surveyor is administrative and not technical. The job is to administer building control as per Building Act and Building regulations and not to be building expert. This is why I would like to see building designs independently reviewed and certified by a second designer similar to what we have with structural designs and form 14.
      Over the last decade I have seen thousands of examples of poor design detailing, it seems we are even unable to put brickwork articulation joints in the right place. And yes, leaking balconies are as common as chips.

  • That's a hard ask Mark. Prudence on the part of the building surveyor would dictate that he or she procures a compliance certificate from a soil engineer courtesy of the provisions of section 238. A GP knows when to refer the client to a medical specialist, likewise a building surveyor should know when he or she is out of their weight division. If a building surveyor takes it upon him or herself the burden of doing something outside their area of expertise the Mercury on the liability barometer will ascend. Hope this is of some help.

  • As usual from Kim Lovegrove, an accurate and timely article.

  • Kim, as you would be aware, many building surveyors totally disregard their duty to inspect for minimum compliance – and as owners are often informed: "the building surveyor is a God!" If for example, building surveyors know that works are non-compliant in relation to the base or foundations stage of a building and go ahead and approve such works for the builder (which will trigger payment) this is a breach of their obligations and duty of care. Such cases are common, definitely not 'shallow' grounds, but for owners to seek redress against this protected class requires a fortune. This conduct is so widespread, with many serial offenders because few offenders are penalized and hence there is no deterrence to not behaving badly. As for the consequences for owners, cases can and do continue for years, some even decades, with the owners and their families lives totally shattered. Why does no-one care about the hundreds of thousands of people who suffer because surveyors refuse to enforce even the most basic compliance issues?

  • Well said Kim, very interesting.

  • Anne building surveyors do indeed have a lot of power and that power was designed to make them regulatory policemen as it were. Even their role as revealed by the above case is not as expansive as some think they still are expected to always be 'on the beat' in terms of important matters of regulatory compliance. This means that they must utilise their enforcement powers to issue notices and orders where the mandatory inspections reveal that their are instances of material non compliance. They must remember that they are servants of the public even though they may not be employed by the " public service". If building surveyors were to be universally proactive and " early interventionist", if issues could be nipped in the bud front end, courtesy of the notice and order powers there would be a paradigm shift. To achieve this it is in my view critical that they are audited annually and I was quoted this week on the Canberra Times when addressing a forum on leaky buildings there stressing this point. Mandatory auditing will help to identify slow response and neglect of early interventionism. It is a given that if construction failure emanating from material regulatory non compliance is not averted in early in metamorphosis the negative impact upon the home owner will grow expedentially. Building surveyors courtesy of Notices and Orders have the power to do this and it is incumbent upon them to do so period.

    • Well said Kim but the problem is that many if not most building surveyors will employ building inspectors for statutory inspections and rely on their certificate. I have watched for over a decade, building inspectors not picking up poor site drainage during construction, failure to act on lack of temporary downpipes resulting in flooding of foundations, ignoring non-compliant paving, even failing to pick up on missing brick articulation joints, failing to pick up breaches of fire separation walls etc etc. When I picked up on non-compliant paving I was once told by building surveyor not to rock the boat and I told him where to go. Building inspectors mostly don't have enough qualification and building experience to be the required watch dog for compliance (I know I have been working with them for over 4 decades).
      What we need is to implement your suggestion of building referees to be populated by very experienced building consultants and given statutory power of building control on site. Then you could take care of compliance, contract conformance, uphold standards of quality and professional conduct of builders all in one hit.

  • Hi Kim,

    Great article. I have a different view on Section 46 of the Building Act 1993 though. In my view Regulations 901(1)(d) & 902(a) of the Building Regulations 2006 provide a process that requires notification of completion of the building work by the builder, and keeping of direction records by the building surveyor. The building work is subject to compliance with the permit (which must comply, see Section 24 of the Act) and cannot be considered 'completed' until all work is completed in accordance with the permit, or if directions were issued to the builder during the construction process; then completed in accordance with the permit, other than any matters that were allowed by the direction/inspection process to be ‘substantially’ compliant, rather than ‘fully’ compliant (see the text in Section 37(1) of the Act).

    In my view this is the reason why the language in Sections 38(2) & 46(2) is included. Both an occupancy permit and a certificate of compliance might be statements of compliance once the building work is completed (and often will be), but without further investigation of the specific permit documents, cannot be used as ‘evidence’ of compliance in a court or any other legal process (and I think the use of the word evidence in this circumstance is intended to be read narrowly).

    I believe practitioners are misunderstanding the intent of this provision and that a building must be compliant at the end of the construction process, unless specifically varied as 'substantially’ compliant (for that specific inspection matter) by the building surveyor in accordance with Section 37 of the Act.

    I would be interested in what others think.

  • Well folks what do you think of Stephen's take on matters. Chime in and have your say.

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