Construction Industry Changes Are in the Wind 2

Tuesday, June 7th, 2016
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Some fairly significant amendments to the building law landscape are now proceeding, albeit slowly, through Parliament.

Broadly speaking, these amendments have a consumer protection focus in the domestic building sphere. Amendments to acts such as the Domestic Building Contracts Act, the Building Act and the Act providing for and regulating the VCAT will be amended.

For example, there will be a new dispute resolution body called Domestic Building Dispute Resolution Victoria through which all relevant disputes must channelled prior to a party being able to make a claim or an application to VCAT or a court. The body will handle disputes through a method of dispute resolution called conciliation, which some say is halfway between mediation and arbitration in respect of the formality of the event. From this body, and for various reasons, parties can refer matters from this body to VCAT.

Arguably controversially, the Building Practitioners Board (BPB) will be abolished and its functions will be conducted by the Victorian Building Authority (VBA). This will certainly be one of the more interesting aspects of the reforms in how it will play out in practice and in time.

As to the system of registration of building practitioners, though there are to be some other more minor changes, key amendments here include introducing a system of registration of five years in duration as a maximum. The builder will then be required to renew his or her license every five years thereafter to be able to continue to operate.

As to conduct of building practitioners, a process termed ‘show cause’ will be introduced where, in cases where the VBA believes a practitioner may have engaged in some form of misconduct, a show cause notice can be sent to that practitioner providing them with an opportunity to explain their actions. Disciplinary action may ensue or the VBA may decide to not proceed.

There will also be changes to the avenues (such as breaching a code of conduct among others) by which practitioners can be alleged to have engaged in misconduct and some changes to some of the laws surrounding building surveyors.

As well as the consumer protection focus of the changes, further aims of the new laws include faster outcomes for builders (and others in the industry) as well as a better overall system of building regulation in Victoria. Some of the regulatory powers of the VBA will be strengthened (whether that will be for better or worse remains to be seen) and there will be further requirements a builder seeking registration or seeking to renew registration will be required to complete. As with most changes to the law in any system, some will be happy and some will not be, and one hopes the correct balance has been or is to be struck between all stakeholders’ interests.

As mentioned, many of the changes are to strengthen the existing protection of consumers. Further changes later this year and perhaps the year after are quite possible.

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  1. Charles Litho

    The best way to protect the consumer is to have an education system for the people in the building industry that is not about marketing and design. The things that go wrong is all about pricing a project and the technical know how to put up walls and roofs. The very "kind insurance system" is picking up and paying for all the faults often years after a building is complete.
    So much time consuming effort is required to get to the building stage, at times I think that refugees from the Republic of Greece public service have been given visas to set up a system in Australia. Often by the time the building stage has been reached every body has had enough of paper shuffling and just want to start building.
    The system is all about putting more people in the line with their hand out to get some of the wealth in the consumers pocket for doing very little.
    Twenty five years ago people who complained were not allowed to work in the building industry again.
    So nobody says a word; except to say everything is wonderful.
    Keeping building regulations a secret does not help the consumer or the builders. Part of the line for the consumers dollar is the people creating standards and regulations that are so expensive few people have copies. The years of begging every body in the building industry to complain has seen the NCC made free online.
    Building standards have to go back to the CSIRO, who in the past were happy to give information and even receive phone calls to advise people.
    As a start I suggest that all standards on roofing be made available on line to save many millions in fixing roof leaks. Even better give away paper copies to everybody, it is a great an investment.

  2. Branko Mladichek

    Informative article, thank you Paul, however I cannot help but think the proposed changes are just another shot of Clayton's consumer protection. Over the last decade i have been to VCAT many times as expert witness and have had many people come to me after wasting their time with Building Commission and the Conciliation run by Consumer Affairs. So now complaining consumers will now be handled by the same inept systems combined ( with mostly the same inept staff that now have new titles with higher pay). How is that going to work? On the other hand, in most cases VCAT will order compulsory mediation prior to hearing, so what is new that the new Domestic Building Dispute Resolution Victoria is bringing to the table? Nothing! Just a rearrangement of Titanic deck chairs, another line of red tape and waste of time, and smoke in the eyes for those that think there is going to be a genuine attempt to protect consumers. Keep dreaming!