Changes to the Building Act & You!

Building Disputes and the Building Legislation Amendment (Consumer Protection) Act 2016 (“BLAA”)

Changes to the Building Act 1993, by the Building Legislation Amendment (Consumer Protection) Act 2016 (or “BLAA”) commenced on Monday 4 July 2016. It amended the Building Act 1993 (BA) and the Domestic Building Contracts Act 1995 (DBCA).

The main changes so far are as follows:

Appointing Building Surveyors

Builders are no longer allowed to appoint a Building Surveyor.  This amendment has been introduced to stop some Building Surveyors from a premature certification of mandatory stages for builders who may be their friends.

Building Surveyors will also now have to be very careful in carrying out their functions and from being engaged in a situation that may give rise to conflict of interests.

There will be a new check list that Building Surveyors must complete.  This check list will have to be lodged with the local Council.  Non-compliance with this requirement will cause the Surveyors to be fined.

Directions To Fix Work and Written Undertakings

The Authority (Victorian Building Authority) may issue a direction to a builder to:

(1)    Fix work;

(2)    Carry out work in substantial compliance with the Building Act; or

(3)    Stop work.

 

Any such direction should be either complied with or appealed to the Building Appeals Board.  An extension of time can be sought to comply with the direction.  Non-action in respect to any direction can result in a fine up to $75,000.

Written undertakings may be provided by a builder to do or not do something.  If a written undertaking is provided by a builder, it becomes public record.  Non-compliance with a written undertaking can result in prosecution of the builder.

 

Owner-Builders’ responsibilities and Regulations for Owners generally.

Owner-Builders can be audited by the Authority to ensure that the works are carried out properly, in compliance with the Building Act and its Regulations, and without posing any danger to anyone.

There are new penalties that could be imposed on the Owners who allow building works to be carried out on their property before a Building Permit is issued.  The penalties are high.

The above information completes the changes to the Domestic Building Contracts Act and the Building Act that are currently in force.

There will be further amendments, the most significant one that will come into force in February 2017 is as below:

Before a dispute can proceed to VCAT Under the new act, to resolve a domestic building work dispute, a certification of conciliation is required to bring proceedings to VCAT. [DP to link back to old building disputes / myth articles].

Cannot Issue at VCAT for a Domestic Building Work Dispute without a Conciliation Certificate

(s.56 DBCA)

The major change being that proceedings in respect to a domestic building dispute cannot be issued at VCAT unless accompanied by a Conciliation Certificate issued by the Chief Resolution Officer (“CDRO”) for Victoria or one of what is being termed the “experienced dispute resolution officers” (“DROs”) (see new s56 & s57A DBCA).

All domestic building work disputes (as defined s44(1), DBCA) relating to any “domestic building work matter” (as defined in s44(2) DBCA) are to be referred to the CDRO for an assessment under s45A of the amended DBCA as to whether not the dispute qualifies for conciliation under the amendments.

The CDRO has been appointed. She is Gina Ralston (“Ralston”). She and her team of “experienced dispute resolution officers” (“DROs”) will initially asses all building disputes (s45A, DBCA). The DRO can call for evidence (s45B, DBCA), accept or reject the referral (s45C, DBCA)

The CDRO must give written notice of the decision to either accept or reject a referral (under s45C DBCA) and give notice of the decision to accept or reject the referral for conciliation under, S45E(1) DBCA) within 10 business days after making the decision!!

HOW LONG WILL MAKING THAT DECISION TAKE?

NOTE – it will be necessary to amend domestic building contracts to include a right to suspension of the building works and the extension of time for the completion of the building works for the period between the referral and the issue of the decision under S45E(1) DBCA and up to and including the implementation of any decision or direction resulting from a conciliation.

A certificate is to be issued if the dispute is not resolved by conciliation (s46D, BLAA) or if an agreement is recorded (s46F, DBCA).

NOTE – Any such conciliation agreement should always include an agreement as to the period for which the building period is to be extended and include a period for the builder to organise trades and materials and return to site.

A Domestic Building dispute is defined as between an owner, a builder, any other Building Practitioner, Sub-contractor, or Architect in relation to domestic building work.

When making an application to the Chief Dispute Resolution Office, section 45 of the DBCA requires you to specify the particulars of the dispute, in addition to other relevant information and documents.

WHAT DOES THIS MEAN? – It means that you need to prepare for the Conciliation if it proceeds and carefully, and in as much detail as if it were a proceeding in a Court or at VCAT – and that’s where we can help.

WHY SO MUCH PREPARATION? – Because the DRO can issue a certificate stating that a party did not participate in good faith s46E,DBCA), can issue a stop work notice (s.47A DBCA), recommend an assessor’s report as to the building works (s48,DBCA) issue a dispute resolution order (s49 & 49B, DBCA) including the payment of money.  There is also a right to appeal to VCAT for review of a dispute resolution order – which must be within 20 business days after the date of the order and on limited grounds.

To give yourself the best chance of settling the dispute and avoid going to VCAT – speak with us as soon as any “dispute” is referred to the CDRO for assessment for conciliation.

The Conciliation may not proceed if you establish that the dispute does not satisfy the requirements in section 45 – WHAT IS THE REAL DISPUTE?

Proper preparation is far better than never ending discussion and expense.

 

This article provides information that is general in nature and is not a substitute for legal advice.