In June 2020 new laws commenced, providing owners with an avenue to sue those involved in the construction of a defective building under duty of care failure. The opportunity to do so runs for 10 years from when an economic loss first become apparent. This new law falls under the provisions of the Design and Building Practitioners Act 2020.
This is a welcomed added protection for owners, but does not replace the essential warranties, which remain difficult for owners to navigate when they first expiry is only 2 years from issuing of an occupation certificate. It is important that owners do not look to these amendments as a substitute for warranties under the Home Building Act. It is additional protection, not replacement of the current regime.
The Government has also introduced a Building Commissioner. The Building Commissioner has extensive powers in relation to new buildings, including the ability to prevent the issuing of an Occupation Certificate where building defects are apparent. This is excellent outcome for owners looking to buy into new schemes.
Buildings whose construction contracts were signed after 1 January 2018,and fall under the building bond and inspection scheme will be now be occupied and operating under this scheme.
Under this scheme, a developer appointed building inspector (who can be vetoed by the owners corporation) must undertake a defects inspection between 15 & 18 months from issuing of the certificate of occupation.
The developer, in order to claim the 2% building bond back, must also rectify those defects between 18 and 21 months from completion date, and within 24 months, those repairs must be signed off by the building inspector.
The cost to repair any incomplete or failed to remedy defects can be applied for against the 2% bond.
It is, in truth, a somewhat arduous scheme to administrator and comply with, but remains more protection than only the Home Building Act offers.