The Licensed Building Practitioners Scheme – Who Must Be Registered and How Does the New Zealand Registration System Compare with its Antipodean Cousin Victoria?
By Stefanie Michieli, Solicitor, Lovegrove Smith & Cotton
The Licensed Building Practitioners (LBPs) Scheme was launched following an amendment to the New Zealand Building Act 2004. The Scheme was introduced as one in a list of reforms following New Zealand’s leaky homes crisis. The leaky homes crisis involved thousands of timber framed buildings constructed during 1994 and 2005 which were deemed to have suffered from weathertightness problems. Decaying timber framing left thousands of buildings structurally unsound, whilst others were uninhabitable on account of mould growing within damp framing.
A number of causes were cited for the leaky homes crisis, but a prominent factor was deemed to be a boom in the New Zealand housing market. The boom meant a large number of builders with little to no industry-related qualifications or experience were carrying out construction works with limited or no supervision, meanwhile developers were operating with little incentive to pay for proper designs.
In a bid to regulate an industry in crisis, New Zealand introduced a system of builder’s registration – and so the Licensed Building Practitioners Scheme was born. Under the Act, only a licensed building practitioner can carry out or supervise ‘restricted building work’. The Building (Definition of Restricted Building Work) Order 2011 came into force on 1 March 2012, defining ‘restricted building work’ as work which is critical to the integrity of a building – namely the construction or alteration of a building’s load bearing structure (e.g. walls and columns), its weathertightness (e.g. roof and wall cladding systems such as ventilators) and the design of its fire safety systems.
Types of work covered include bricklaying, foundations, framing and roofing. Similarly, design work relating to a building’s load bearing structure or its weatherproof envelope is also covered. In contrast, ‘restricted building work’ does not include work on sheds, farming buildings, patios and stand-alone garages, or household DIY tasks like fitting doors and making alterations to non-structural walls.
The restrictions relate to the residential construction and design of houses and small to medium sized apartment buildings. Small to medium sized apartments buildings are defined as developments that have up to two or more residential units and a maximum height of 10m.
Practically speaking, any work to a residential home or apartment which requires a building consent is likely to encompass some aspect of restricted building work. To this end, a building consent will not be issued without evidence that a licensed building practitioner is actively involved in the project.
How Does One Become a LBP?
The Licensed Building Practitioners Scheme encompasses seven license classes, which are based on specific occupations crucial to building work. These are:
- External plastering;
- Brick and blocklaying; and
One can apply to be registered in more than one class (e.g. carpentry and roofing), provided a practitioner meets the minimum competencies required by each class. Once registered in a class, a practitioner is permitted to undertake all work covered by their license class – though as a LBP one is expected to exercise discretion and good judgment when supervision or other skills are required.
Under r.20 of The LBP Rules, registration is required to be assessed every two years from the date of issue. In order to reassess competencies, practitioners must participate in a Skills Maintenance programme, which requires one to keep records of “learning activities” participated in. This might involve attending a training provider workshop, attend seminars or supervising apprentices.
Who Are Designers?
Designers are practitioners designing any kind of building. The main competencies required by practitioners in the design class include managing the design process, establishing design briefs and scope of works, preparing preliminary designs and producing construction drawings and documentation. Designers include draftspersons, architects and engineers – though engineers and architects are automatically treated as LBPs provided they are registered with the Institute of Professional Engineers New Zealand (IPENZ) or with the New Zealand Registered Architects Board respectively.
The Owner-Builder Exemption
An exception to the LBP Rules comes in the form of The Building Amendment Act 2012, which under s.90A-D states that owner-builders are exempt from the requirement that they hire licensed practitioners to carry out ‘restricted building work’ on their homes.
To qualify as an owner-builder under the exemption, you must intend to reside in the house where the works will be carried out, and you must carry out the work alone or with the assistance of unpaid friends and family. Additionally, you must not have carried out restricted building work to any other home within the previous 3 years.
Under s.291 of the Act, registered architects and chartered professional engineers are automatically treated as LBPs in the design class. To this end, a registered architect will automatically attain a licence as a building practitioner. Similarly, registered plumbers and gasfitters are automatically treated as licensed building practitioners in the roofing, external plastering, and brick and block laying licensing classes. Practitioners which fall under these cases of automatic licensing are not required to pay a levy nor apply for a licence under the LBP Scheme.
Disciplinary Processes under LBP Scheme
If an individual other than an owner-builder deliberately carries out or supervises restricted building work while unlicensed, they have committed an offence under s.85 of the Act and are liable for a fine of up to $20,000. By the same token, an owner of a building who knowingly engages someone to carry out restricted building work who is unlicensed will also commit an offence.
Under the Building (Infringement Offences, Fees, and Forms) Regulations 2007, a Council may also issue you with an instant fine. An on-the-spot fine for a non-licensed practitioner engaging in restricted building work amounts to a $750 fine, while a person claiming to be registered to do a certain type of restricted building work but is not registered in the appropriate class can be issued a $500 fine.
How do New Zealand’s LBPs compare with Victoria’s Registered Building Practitioners?
The Licensed Building Practitioners Scheme can be compared to the Australian jurisdiction of Victoria’s system of builder’s registration.
Under s.170 of the Victorian Building Act 1993 an applicant is required to either hold an appropriate prescribed qualification, or a qualification together with experience equivalent to a prescribed qualification. Additionally, the Victorian Act expressly states that an applicant be of good character, and has the power to arrange a police check under s.169A. In contrast, making an application under the LBP Scheme does not require a recognised qualification.
Under Schedule 7 of Victoria’s Building Regulations 2006, the following categories and classes of practitioners are required to be registered. The Schedule also lists the prescribed qualifications:
- Building surveyor (Unlimited/Limited) – A degree, advanced diploma or diploma in building surveying and 2-3 years of practical experience;
- Building inspector (Unlimited/Limited) – A diploma of building surveying, and 2 years of practical experience or a certificate from the Board certifying the applicant has adequate knowledge and experience;
- Quantity surveyor – A degree or diploma in quantity surveying, and 2 years of practical experience;
- Engineer (Civil) – A degree in civil engineering, and 3 years of practical experience or a current certificate of registration as a civil engineer on the National Professional Engineers Register (NPER);
- Engineer (Mechanic) – A degree in mechanical engineering, and 3 years of practical experience or a current certificate of registration as a mechanical engineer on the National Professional Engineers Register (NPER);
- Engineer (Electrical) – A degree in electrical engineering, and 3 years of practical experience or a current certificate of registration as an electric engineer on the National Professional Engineers Register (NPER);
- Engineer (Fire Safety) – A degree in fire safety engineering;
- Draftsperson (Building design – architectural, interior, services) – An advanced diploma in building design, an associate diploma of arts (interior design), an associate diploma of engineering drafting (civil, electrical or mechanical) or a certificate IV, diploma or advanced diploma in fire technology, and 1 year of practical experience;
- Builder (Commercial builder – Unlimited) – A degree, diploma or associate diploma of building from a university or TAFE and 3 years of practical experience, or a certificate of successful completion of the “Course in Builder Registration (BPB)” and 3 years of practical experience;
- Builder (Commercial builder – Limited) – A certificate issued by the Board certifying that the applicant has adequate knowledge and experience.
- Builder (Domestic builder – Unlimited) – A degree, diploma or associate diploma of building from a university or TAFE institute and 3 years of practical experience, or a certificate of successful completion of the “Course in Builder Registration (BPB)” and 3 years of practical experience;
- Builder (Domestic builder – Limited) – A certificate issued by the Board certifying that the applicant has adequate knowledge and experience;
- Builder (Demolisher – low rise buildings/medium rise buildings/unlimited) – A certificate issued by the Board certifying that the applicant has adequate knowledge and experience;
- Erector or supervisor (Temporary structures – Class 1) – An intermediate scaffolding licence issued under the Occupational Health and Safety Regulations and 1 year of practical experience;
- Erector or supervisor (Temporary structures – Class 1) – A certificate issued by the Board certifying that the applicant has adequate knowledge and experience and 2 years of practical experience.
Penalties for unregistered practitioners in Victoria are also greater. Under s.176(1A) individuals who carry out building work whilst unregistered, or ‘hold themselves out’ as being registered under the Building Act will be liable for a maximum penalty of approximately $72,000.
Another obligation upon registered practitioners in Victoria is that they be covered by insurance under Part 9 of the Victorian Act. Under s.136, it is an offence to carry out building work or manage work under a major domestic building contract unless they are covered by the required insurance – the maximum penalty for an individual being in excess of $70,000.
Similarly, registered practitioners in Victoria are required to provide written proof that until the next anniversary of his/her registration, the registered practitioner will be covered by the required insurance. In stark contrast, The New Zealand Building Act 2004 remains silent on the subject of insurance. This creates a personal liability for builders and no consumer protection.
Building Officials – The Regulatory Gate Keeper
The role of a building surveyor can be likened to that of a gate keeper. Building surveyors ensure works are carried out in accordance with relevant building regulations, and provide the final stamp of approval on building plans. In the Australian jurisdictions, in order to become accredited with the Australian Institute of Building Surveyors (AIBS) a surveyor must undertake a tertiary qualification such as a Bachelor of Construction Management (Building) or a Bachelor of Building Surveying and Certification. In contrast, building surveyors and inspectors in New Zealand are not required to hold a robust qualification.
Additionally in Victoria, building surveyors, building inspectors and quantity surveyors are all required to be registered as Registered Building Practitioners whereas in New Zealand surveyors, building inspectors and quantity surveyors do not fall under any of the seven licensing classes for Licensed Building Practitioners – and consequently do not require registration under the LBP Scheme. Given the important role building officials hold in the building industry, their omission from the Scheme seems both problematic and questionable.
While it can be noted that in Victoria building surveyors can fall within the private sector or local government, in New Zealand building consents are ultimately issued by Councils. In this respect, the “deep pockets of the Council” i.e. “the insurer of last resort” will in all likelihood indemnify for any serious deficiencies of building surveyors.
The Licensed Building Practitioners Scheme was introduced to regulate a building industry in crisis. One must question, however, how far the Scheme actually goes in ensuring the competence of practitioners and the penalties for unlicensed builders. Similarly, and in light of Victorian legislation on point, questions must be raised as to why mandatory insurance is not being enforced. Whether the New Zealand system improves the quality of the industry is yet to be seen.
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© Lovegrove Smith & Cotton 2014