Public consultation drafts of the Regulations under the yet to commence Strata Schemes Development Act 2015 and the Strata Schemes Management Act 2015 (Management Act) (click here for details) have been released:

 One of the key reforms of the Management Act is the introduction of a building bond to be paid by developers of high rise residential buildings and an associated building inspection regime to unlock that building bond. 

The Management Act left a number of questions unanswered in relation to the new regime.  In particular, what were the necessary qualifications for a building inspector, and what was the form of the report?  The Management Regulation doesn't fill the void on either issue. 

Firstly, on the qualifications of building inspectors, the response is to leave the decision up to eight membership bodies to each establish strata panels.  This gives rise to a real possibility that different skills will be found between the membership of each strata panel and to the possibility of the inspection equivalent of "forum shopping". 

There is an opportunity missed here to ensure consistency and to establish a minimum level of qualification or experience.  An opportunity is also missed on requiring a minimum level of professional indemnity insurance cover, bearing in mind that under the regime, the building inspector is to proactively identify every defect in a high rise residential building.  Of course, each membership body may elect to make this a prerequisite for appointment to their strata panel.

On the second issue, the content of the reports, this is left to be expressed later "in a form approved by the Secretary". 

On other issues, it is noted (as expected) that the Regulation makes the Secretary's decision to pay the building bond under Section 209, a decision subject of internal review, requiring written reasons.  It is expected that this will also be fertile ground for external review. 

What seems to be overlooked in this regime by both the Act and the Regulation is what happens to buildings for which the initial period ends later than 12 months after completion of the building work?  It will only take the market to term for this to be a reality.  Whilst those buildings will have building bonds, the mechanism to access them through the building inspection report process is not enlivened unless the initial period ends within 12 months of completion of the building work.  Presumably, the process to access funds in these instances will be dealt with on an adhoc basis under the Secretary's power to vary the times which anything is to be done under Part 11 of the Act.

Public submissions on the consultation draft close on 27 May, make sure your views are heard. For more information on how to comment follow this link.

In the media

Performance Construction Index shows first growth in 5 months

Mixed signals are emerging from the construction sector with renewed vigour in larger infrastructure projects, but a significant fall in activity in housing and apartment work (06 May 2016) More...

Building Surge Drives Construction Prices Higher

Tender prices in the construction sector throughout Australia are rising at their fastest pace in many years as massive levels of investment in apartments and infrastructure put contractors in a strong bargaining position, especially in eastern states (06 May 2016)  More...

Interim Senate report shares concerns about asbestos imports

An interim senate report tabled last included concerns about law enforcement agencies being able to deal with the illegal import of building products containing asbestos (05 May 2016) More...

Weak regulation allowing asbestos-laden building materials to slip into Australia: report

Glaring weaknesses in regulations and border protection issues are allowing building products contaminated with potentially deadly asbestos into Australia, a Senate committee has warned.  (04 May 2016) More...

Be aware – Contract requirements may breach Building Code 2013

Contractors should take care, when entering into contracts for building work, not to agree to engage in conduct that may breach the Building Code 2013 (26 April 2016)  More...

NSW 

Central Coast Man Prosecuted For Building Insurance Fraud

A Wamberal man has been convicted of fraud after falsifying a Home Building ompensation Fund certificate for residential building work valued at almost half a million dollars.  (06 May 2016) More...

John Francis Toal and Rock Cliff Holdings PTY LTD Prosecuted

An Oberon man who pocketed thousands of dollars by promising to carry out home renovations that never eventuated has been prosecuted by NSW Fair Trading. On April 2016 Rock Cliff Holdings Pty Ltd, a company through which Mr Toal operated, was also convicted of similar offences and ordered to pay a further $7,180 in fines and costs and pay three of his victims a total of $17,930 compensation (04 May 2016)  More...

Developers to offer design collaboration with community through 'urban pinboard'

When developers plan new housing projects in the future, they might go directly to locals to explain their schemes, and show sketches of what they'll look like, to receive community feedback before going anywhere near council (29 April 2016)  More...

Published

Australian Bureau of Statistics

Building Approvals, Australia, Mar 2016 (cat no. 8731.0) (03 May 2016)

Practice and Courts

ABCB consultation: Fire Sprinkler Regulatory Impact Statement

The RIS assesses the problem of fire occurring on balconies of residential buildings over 25 metres and considers options to safeguard occupants in the case of a fire event. Submissions closed on26 April 2016. See ABCB website.

NSW BPB: Announcement of regulations applying to the sale of properties with swimming pools

Minister for Local Government Paul Toole has announced regulations applying to the sale of properties with swimming pools to take effect from 29 April 2016.  More...

NSW: Register loose fill asbestos properties

Property owners whose homes have been affected by loose-fill asbestos insulation have until August to register with the Fair Trading Loose-Fill Asbestos Insulation (LFAI) taskforce.  More...

NSW: April 2016 e-news

The e-news is a regular digest of work by the Board, legislative updates, events, training and consultation opportunities (29 April 2016)  Read our April 2016 e-news

Cases

Chan v Acres (No 2) [2016] NSWSC 557

PROCEDURE – application for correction to earlier reasons pursuant to UCPR r 36.17 – rule does not apply – discretion by the Court to withdraw reasons for the purpose of correction – correction of earlier reasons.  More...

Lauer v Comer [2016] NSWCATAP 99

Appeal against allowance of quantum meruit – insufficient findings to support allowance.  More...

Hammoudi v Commissioner for Fair Trading [2016] NSWCATOD 57

Owner builder permit; dual occupancy; special circumstances.  More...

Younan v Commissioner for Fair Trading (No 2) [2016] NSWCATOD 60

COSTS – Whether special circumstances warrant an award of costs – Whether respondent's claims had any tenable basis in fact or law – Whether respondent repeatedly failed to comply with the duty imposed upon him under s 36(3) of the Civil and Administrative Tribunal Act 2013 (NSW) – Whether respondent conducted the proceedings in a way that unnecessarily disadvantaged the applicant – Satisfaction that special circumstances warrant an award of costs.  More...

Legislation 

NSW 

Regulations and other miscellaneous instruments

Building Professionals Amendment (Accredited Certifiers) Regulation 2016 (2016-215) — published 6 May 2016

The object of this Regulation is to amend the Building Professionals Regulation 2007 to enable accredited certifiers involved in carrying out work on a swimming pool to issue a certificate of compliance under section 22D of the Swimming Pools Act 1992 if certain conditions are met.  The Regulation also reduces the application fee for the issue or renewal of a certificate of accreditation of category E1 to $750.

Home Building Amendment (Fees) Regulation 2016 (NSW) – published 11 May 2016

The object of this Regulation is to amend the Home Building Regulation 2014 as follows:

  1. to increase the application fees payable in connection with the administration of the Home Building Act 1989,
  2. to decrease (from $48 to $45) the fee payable for the replacement of a contractor licence, certificate or owner-builder permit so as to be in line with the fee charged for the same type of service in other administered licensing regulations.

  3. This publication does not deal with every important topic or change in law and is not intended to be relied upon as a substitute for legal or other advice that may be relevant to the reader's specific circumstances. If you have found this publication of interest and would like to know more or wish to obtain legal advice relevant to your circumstances please contact one of the named individuals listed.