Articles

By Justin Cotton, Director, Lovegrove & Cotton – Construction and Planning Lawyers

With recent reform of the Building Act 1993, and possibly responding to publicly raised concerns such as the fire safety of aluminium composite cladding products, the Victorian Building Authority now has greater powers at its disposal to direct building practitioners to act or not to act in a certain way.

This includes enhanced ability to direct or seek undertakings from the Relevant Building Surveyor (“RBS”), both Council and private, given the RBS’ role as the “regulatory gatekeeper” in the construction industry.

Anecdotally, one hears of the pressures that can be brought to bear from both sides on the private RBS in the privatised building surveyor system.  It goes without saying that there can be a tension between the imperatives and motivations of the Developer who wants to ensure construction is completed as quickly and cheaply as possible, and the public interest aspect of ensuring safe and compliant construction.

The regulatory authority (in Victoria, the VBA) and local Councils will be in the role of watchdog for matters of compliance and “fitness for occupation”, and the latter are common sources of complaints against private Building Surveyors.  Meanwhile, the VBA has the task of administering the registration system for building practitioners and the disciplinary process for those practitioners (currently involving “Show Cause Notices” at first instance).

It may well be that a private RBS will come under scrutiny and pressure from the VBA either to act in a certain way or to refrain from acting.  This will be pressure from one side, while from the other camp the RBS has simultaneous angst from the Developer or their Builder who will want an approval to be afforded or steps to be taken in the other direction, and as soon as possible.

Reference is made to the power in section 205M of the Building Act 1993.  Subsection (1) reads:

“If it considers it necessary for the purposes of this Act or the regulations, the Authority may direct a municipal building surveyor or private building surveyor to carry out his or her functions under this Act or the regulations –

• in accordance with this Act or the regulations; or
• within a period specified in the direction.”

Also at subsection (3), it is said that the Authority (the VBA) may recommend to the person who appointed a municipal building surveyor or private building surveyor that the person take action specified by the Authority.  This can be done if the Authority considers it necessary “for the purposes of this Act or the regulations”.

This wide ranging power means that the Authority can give directions to both a private RBS and indeed a Council MBS to act or refrain from acting in a certain way, and at the same time could make recommendations to the person who appointed that Building Surveyor on steps that should be taken.  That person appointing the RBS would be the Owner of the land where the building works are proposed.

Notably, though, section 205M of the Act states that a notice of intention to give this direction must first be given by the Authority to the Building Surveyor.  This must be a written notice that advises the intention of the Authority to give the formal direction, and provide a period of not less than 14 days within which the Building Surveyor may make submissions to the Authority about the matter.

Private clients, however, always have recourse to the appeal process at the Building Appeals Board, for example to appeal a Building Order that has been issued by the RBS – whether or not that was following on from a direction from the VBA.

A potential avenue for a Building Surveyor who finds themselves “the meat in the sandwich”, caught between the line taken by the VBA and a potentially recalcitrant client, is to refer the matter on to the VBA after a Building Order has not been complied with.  If this occurs, the RBS must make this referral (after the 14 day period elapses) and then have nothing more to do with the matter (see section 115 of the Act).

In addition of course, if the question is about whether it is appropriate or not to approve an application for an Occupancy Permit, then the conservative and safer avenue would be for the RBS to await the outcome of any matters before the Building Appeals Board before making any determination of the application.

This is important for two reasons; firstly, the professional and prudent RBS would have public safety and building industry compliance as their number 1 driver, and the risk of later facing a disciplinary complaint and investigation from the VBA is not to be overlooked.

On top of this, if works down the track are suspected as being defective or non-compliant with the Regulations (which call up the Building Code), then the RBS could find themselves joined as co-respondents to a civil action for defective workmanship later brought by the owners for the time being of the land. This could involve of course residential apartment buildings where there could be a number of owner applicants, plus the Owners Corporation in respect of common property faults.

Notably, there are other powers at the VBA’s disposal.  Under section 234B of the Act, the Authority “may accept a written undertaking given by a person in connection with a matter in relation to which the Authority has a function under this Act”.

If such an undertaking is given, potentially by an RBS or a Builder to the VBA, then it can only be withdrawn or varied later on if that practitioner has the consent of the VBA.

Also, if the VBA considers at a future time that the person who gave the undertaking has failed to comply with any of its terms, the VBA can apply to a Court for an order. Should the VBA be successful in such an application, of which there would be a high risk, then the practitioner respondent to the application could well also face an order to pay legal costs.

This order could be one that compels the practitioner to comply with the terms of the undertaking.  It could also be an order by the Court directing a practitioner to carry out building work or protection work or an order to pay compensation.

Therefore, it could be possible that the RBS for a site where the VBA has significant concerns, could receive a letter of demand requiring an undertaking to be given that the RBS will act or not act in certain ways (consistent with an RBS’ functions). One example could be a demand for an undertaking that the RBS not issue an Occupancy Permit until certain steps have been taken or certain matters satisfied.

Naturally, each case scenario has to be looked at on its own merits, and it could be a fine line between the legitimate exercise of “higher” enforcement powers by the VBA and potentially too great an intervention into the professional discretion of an appointed RBS. In matters of building control, there will often be situations where reasonable minds can differ on the correct technical interpretation and outcome.

An additional capacity in the Building Act 1993 is found in section 234E (injunctions).  Therefore a letter of concern or demand from the VBA may include a threat to apply to a Court for an injunction to either prevent a building practitioner (including an RBS) from acting in a certain way or conversely to compel certain steps to be taken.

Section 234E of the Act states at subsection (1):

“A court may grant an injunction, in such terms as the court considers appropriate, if the court is satisfied that a person has engaged, or is proposing to engage, in conduct that constitutes or would constitute – (a) a contravention of a provision of this Act or of the regulations or of a notice, permit, direction, order or determination issued or made under this Act or the regulations (including a notice or order or determination of the Building Appeals Board)…”

The Court can grant the injunction on application by the Authority (ie the VBA), a Municipal Building Surveyor (ie an MBS), Energy Safe Victoria or “any other prescribed person”.

Again, the risk is there that if such an application were made, and if the Court (generally the Supreme Court) were minded to grant the injunction, then the practitioner could be up for the legal costs of the exercise, which could be significant.

For further advice or assistance from experts in building law and advice on regulations, do not hesitate to contact construction law experts well versed in all aspects of building control and dispute resolution.

Lovegrove & Cotton: Leaders in building practitioner legal representation

Lovegrove & Cotton are experts in construction law and building practitioner legal representation in Melbourne, Sydney, the ACT and Queensland. Justin Cotton has represented building practitioners and building surveyors successfully for nearly fifteen years and has established leading precedence in a number of Australian tribunals. If the reader knows of anybody who needs legal representation in this complex and gravity-laden area, feel free to contact us via our website or by emailing enquiries@lclawyers.com.au.