The Design and Building Practitioners Act 2020 (NSW) (DBP Act) and the Residential Apartment Buildings (Compliance and Enforcement Powers) Act 2020 (NSW) (RAB Act) are two significant limbs in the push to reform the building industry in NSW. The Acts have significantly altered the risk profile of projects and their participants.
The RAB Act arms the NSW Building Commissioner with a suite of discretionary powers, such as the power to make orders requiring builders and developers to rectify defective building works or to stop work on residential apartment building projects.
The DBP Act has increased the regulation and scrutiny of building and design practitioners, by introducing a registration scheme and mandatory insurance, as well as requiring designs to be registered and compliance declared for class 2, 3 and 9c buildings. The DBP Act also introduces a statutory duty of care to take reasonable steps to avoid causing economic loss to owners, in relation to building work generally.
The Acts have evolved since 2020, with the most recent amendments made in 2023.
Each Act includes provision for review by the Public Accountability Committee (PAC) of the Legislative Council. On 21 May 2024, PAC adopted the following terms of reference for the review:
- to consider the functions exercised or delegated by the Secretary
- to determine whether the policy objectives of the Act remain valid and whether the terms of the Act remain effective for securing those objectives
- to consider the desirability of establishing an independent NSW Building Commission to instead exercise the regulatory and oversight functions relating to the construction of buildings.
In adopting the terms of reference, the PAC noted that the third limb of the terms of reference had been made redundant by the establishing of the NSW Building Commission on 1 December 2023.
The Acts have been the source of significant uncertainty in the construction industry during their infancy and so the review is certainly welcome, to the extent that it may recommend clarification of obligations and powers. However, it is considered unlikely that any clarification of the scope and nature of the statutory duty of care will arise from the review, as this will evolve from the jurisprudence rather than codification.
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.