Encouraging words from our NSW Building Commissioner in a recent interview …[1]

The construction industry in New South Wales is in crisis and has been at an impasse for a long time.  The question as to why we have so many building defects, particularly in multi-storey residential apartment buildings, was being asked long before the Opal and Mascot tower disasters and the Lacrosse fire.

When did this start?  Was it the shift to a performance based national construction code? Is it the result of the design and construct contract? Is it the failure to continually upgrade the Australian Standards to ensure builders know how to build better buildings?  Is there a lack of training, education and supervision for tradespeople?

Whatever the reason or reasons, David Chandler OAM, the NSW Building Commissioner, strongly agrees that ‘something needs to be done with the industry’.

The NSW Government has been at the forefront of reform and remarkably the most pro-active since the release of the Shergold Weir report in early 2018[2].  This seemingly needed to be the case given NSW has the highest rate of apartment living within Australia. The number of people residing in residential apartments in New South Wales has recently been reported as being 1,123,464 people (15 percent of the population) as opposed to 8 percent of the population living in apartments in Victoria,  7 percent in Queensland, 4 percent in Western Australian and South Australia, 3 percent in Tasmania with the ACT and Northern Territory coming in second to NSW at 10 percent[3].  For three to four years from 2015, the number of development applications for ‘attached dwellings’ was higher than that for detached dwellings, although this has ‘dipped’ more recently.

The Shergold Weir report included the authors’ observations on the compliance and enforcement systems for the building and construction industry and highlighted 24 recommendations for a national best practice model which will strengthen the effective implementation of the National Construction Code. 

The NSW Government spun the wheels for 12 months before coming back with its response to the recommendations in early 2019.[4]

We have since seen positive action by the Government to implement the major reforms identified in its initial response, namely, its commitment to:

• Appoint a Building Commissioner – David Chandler OAM was appointed as the NSW Building Commissioner in August 2019 and is gearing up for 1 September 2020 with his recently granted powers under the Residential Apartment Buildings (Compliance and Enforcement Powers) Act 2020[5] (RAB Act), pursuant to which he will be able to stop occupation certificates from being issued for residential apartment buildings , make orders for developers to rectify defective buildings and issue stop work orders. The Building Commissioner citing that there will be no ’cutting corners’ and that he is aiming to ‘rid the industry of dangerous, builders and certifiers…’[6].
• Overhaul compliance reporting, require building practitioners with reporting obligations to be registered – recently passed reform includes the RAB Act and the Design and Building Practitioners Act 2020[7] (D & BP Act) assented to on 10 June 2020 with the majority of provisions, relating to design declarations, registration of practitioners with adequate insurance, etc to commence on 1 July 2021.
• Ensure that there is an industry-wide duty of care to homeowners – Part 4 of the D & BP Act commenced from 10 June 2020 to introduce statutory duty of care provisions allowing subsequent title holders in residential apartment buildings, including owners corporations, to bring a claim for economic loss arising from the rectification of defects arising from construction work against building practitioners, engineers, product suppliers and manufacturers.

Having previously doubted that we were moving in the right direction, I was quietly reassured in a recent meeting with the Commissioner that ‘change’ is happening.  Proactive steps are being implemented.  The ‘six pillars’ of reform are well established after introduction in February 2020 and developers, builders, certifiers and other construction professionals will be held accountable for their actions.  Systems are being put in place.  Repeat offenders will not be able to hide with an advanced new digital framework to be put into play to identify ‘risky’ builders and developers with their profiles readily accessible with the high risk category builders excluded from proposed decennial liability insurance.[8]

Whilst there are still areas where further reform and improvements are needed, there have been many steps in the right direction over the past twelve months and there is what appears to be a ‘man on a mission’ at the helm of the team.

Let us see where 2020 and beyond takes us …any step forward is a positive step!

[1] 60 Minutes interview ‘Buyer Beware’

[2] Building Confidence – Improving the effectiveness of compliance and enforcement systems for the building and construction industry across Australia prepared by Professor Peter Shergold and Ms Bronwyn Weir https://www.industry.gov.au/sites/default/files/July%202018/document/pdf/building_ministers_forum_expert_assessment_-_building_confidence.pdf

[3] Australian Strata Insights 2020 A report prepared by City Futures Research Centre, UNSW Sydney, June 2020 file:///C:/Users/hek/Downloads/Australasian_Strata_Insights_2020_Final.pdf

[4] https://www.fairtrading.nsw.gov.au/resource-library/reports/nsw-government-response-to-the-shergold-weir-building-confidence-report

[5] Residential Apartment Buildings (Compliance and Enforcement Powers) Act 2020 https://www.legislation.nsw.gov.au/#/view/act/2020/9/part5/div1

[6]  Refer relevant linked article at:…/insert link/

[7] Design and Building Practitioners Act 2020 https://www.legislation.nsw.gov.au/#/view/act/2020/7

[8] Building Confidence NSW Reshaping the customer value proposition  Moving from ‘Crisis to Safe to go back in the market’ July 2020

By Helen Kowal, Partner, Prop­er­ty, Plan­ning & Projects, Stra­ta, Swaab 

I pride myself on listening to the client, thinking outside the square and finding a solution that meets the client’s needs.

I conduct proceedings in the NSW Civil and Administrative Tribunal, Supreme Court of New South Wales, Local Court of New South Wales and in the Land and Environment Court of New South Wales.

With a legal career spanning over 25 years in general practice, for the past decade I have specialised in building, construction, strata and property. I have worked for many owners corporations, developers and builders in all facets of building and construction law in all jurisdictions.

EXPERIENCE:
• Acting for owners corporations, owners and builders in building defect claims under the Home Building Act 1989 in NCAT and Supreme Court of NSW
• Acting for developers, owners corporations and lot owners at the forefront of strata renewal legislation introduced in November 2016
• Acting for owners corporations and owners in strata disputes arising under the Strata Schemes Management Act 2015
• Negotiation and drafting of building contracts, project management and superintendent agreements
• Acting in boundary and development matters including easements, crane and ground anchor licence deeds, boundary, tree and fencing disputes and planning issues

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