How to Respond to Cladding Rectification Notices and Orders in Victoria
By Kim Lovegrove RML, FAIB, Senior Lawyer, Lovegrove & Cotton – Construction and Planning Lawyers
In recent months a flurry of Building Orders have been served on building owners throughout Victoria in respect of buildings that are considered by the regulators to harbour combustible cladding. The writer’s firm has been briefed on a number of occasions by owners corporations to assist with the resolution of combustible cladding conundrums or “regularization” scenarios. This piece provides insights into ways by which respondents can work through the vexed and challenging combustible cladding rectification paradigm.
Municipal and Private Building Surveyors, Notices and Orders – Who has Jurisdiction?
In some instances the Victorian Building Authority has assumed the role of the Municipal Building Surveyor, but in the majority of instances local councils have maintained jurisdiction by virtue of their enforcement and administrative responsibilities under section 212 of the Building Act 1993 (‘the Act’).
Sometimes there is a concurrent jurisdiction that involves private building surveyors (‘PBS’) if the buildings are still a work in progress, in circumstances where private building surveyors have been appointed as the relevant building surveyors (‘RBS’). This is a vexed area in terms of jurisdictional demarcation, as on the one hand the MBS must discharge said admin and enforcement responsibilities under section 212, yet the private building surveyor as the RBS on record cannot resile from their own statutory remit with regards to ensuring that the Building Act is complied with.
If it transpires that both the MBS and the PBS have assumed a concurrent jurisdiction in terms of issuing building notices and orders great care must be taken by both parties with respect to ensuring that they do not “trip over each other”, as the legislative demarcation of responsibilities under the legislation is neither neat nor corralled. Confusion can ensue and both parties, unless they are very careful, may intrude into the domain of the other, yet neither the PBS nor the MBS are afforded the luxury of assigning the other actor exclusive jurisdiction.
Building Notices and Orders can still be served after the building is completed
Section 106 gives the RBS the ability to issue a building notice if the RBS considers that building work has been carried out in contravention of the Act. Building Cladding Rectification Notices and Orders can be served by council and private building surveyors alike whilst the building work is on foot (i.e. the stage between the issue of a building permit and the occupant permit and the certificate of final inspection). Section 107(2) of the Building Act provides that a PBS can serve a building notice or building order on a building, after a certificate of final inspection or an occupancy permit or temporary approval has been issued.
The MBS on the other hand has an ongoing jurisdiction under section 212 and can, likewise, serve statutory notices arguably in perpetuity if the building poses a safety risk many years hence.
A Building Notice is a precursor to a Building Order and if a respondent fails to comply with a Building Notice, a Building Order can be served. Section 111 of the Building Act 1993 provides that either a municipal building surveyor or a private building surveyor may issue a Building Order.
That which an Order can dictate
Below is an abridged version of section 111. A building order may—
- compel evacuation;
- prohibit entry and occupation;
- direct the owner of a building to carry out building and or protection work;
- cause an inspection of that building;
- Cause specified material to be tested;
- demand that a building component be subjected destructive testing by a prescribed testing authority if the RBS believes on reasonable grounds that the component`s use contravenes the Act or the regulations; or
- demand an owner or builder provide the results of any destructive testing of to the RBS or an authorized delegate within a specified time.
Deemed Refusal – Careful!
Section 116 gives the Relevant Building Surveyor (‘RBS’) the power to amend or cancel a Building Order. The RBS is fettered with the sole discretion to approve or refuse to cancel a Building Order. It is important to note that it will be a deemed refusal if the RBS elects neither to amend nor extend the order within the prescribed time imposed in the order. Orders will typically impose time limits for compliance and it will be incumbent upon the respondent to formally respond and take appropriate action within the time period stipulated in the Order.
If a respondent refuses to carry out building work that is the subject of an Emergency Order or a Building Order, the council may cause the work to be carried out. In circumstances where the MBS causes such work to be carried out, the council can recover the costs associated with that work from a court of law. As the cladding debacle unfolds, councils may well find themselves compelled to unilaterally fund emergency remediation works if respondents refuse to do so on account of budgetary restraints. This eventuality is quite possible because financially over-committed respondents may find themselves bereft of the resources to fund such expenses. Councils must be live to this possibility because the legislature ensured that councils were invested with the power to carry out building works in circumstances where there was lack of cooperation on the part of the property owner.
In recent times, some MBSs have felt compelled to issue Emergency Orders pursuant to section 102 in circumstances where they have held a belief that the ‘order is necessary because of a danger to life or property arising out of the condition or use’ of the building. Although Victorian private building surveyors have the power to issue building notices and orders, they do not have the power to issue Emergency Orders.
You will find that the terms of every Building Order will tend to differ
Typically, the Building Order will make it known that it has come to the MBS’s attention that the building has non-compliant cladding and the Order will show cause as to what steps the recipient will deploy or regime will be implemented to allay the fears of the MBS. Every Order is different because every building is in terms of number of stories, occupants, intended use and the fire retardant matrix is bespoke to that building.
What to do when one receives a building Notice or Order – All hands on Deck
Upon receipt of a building notice immediate energies must be devoted by the respondent to ‘engineer’ compliance. If the notice is not complied with, then a Building Order will be issued and regard must be had to the fact that it is an offence to fail to comply with a Building Order within the time specified within the order. Further prosecution can ensue for non-compliance with a Building Order or an Emergency Order; and within the combustible cladding paradigm, a failure to comply with a Building Order could give rise to very serious consequences, not the least of which being high fines. Were there to be a death attributable to the serious neglect of a relevant actor, in terms of their failure to discharge their obligations during their involvement with a cladding remediation regime, then that would attract a negative finding in a coronial inquest and potentially criminal liability for criminal negligence. For there to be a finding of criminal negligence there would have to be evidence of serious negligence that displays disregard for the life and safety of others. As Callaway JA noted in the Victorian case, R v Wright , quoting Lord Aitkin in a speech to the House of Lords regarding the case law:-
‘In explaining to juries the test which they should apply to determine whether the negligence, in the particular case, amounted or did not amount to a crime, judges have used many epithets such as ‘culpable’, ‘criminal’, ‘gross’, ‘wicked’, ‘clear’, ‘complete.’ But whatever epithet be used and whether an epithet be used or not, in order to establish criminal liability the facts must be such that, in the opinion of the jury, the negligence of the accused went beyond a mere matter of compensation between subjects and showed such disregard for the life and safety of others as to amount to a crime against the State and conduct deserving punishment.’
Property Owners Must Respond when Served with Compliance Instruments
It is very important for individual unit owners to not assume that the owners corporation is invested with sole responsibility to comply with the Order. This will frequently not be the case as the owners corporation may only have jurisdiction to comply with the order as to common property. The writer has had carriage of matters where orders have been served upon every property owner in a strata community. Much time and care has had to be deployed to ensure that each Building Order is responded to on behalf of the respondent i.e. the unit holder. In one particular matter known to the writer, 14 separate appeal instruments had to be lodged with the BAB simultaneously as the RBS had not extended the time limits for compliance with the Building Order.
If an unsuspecting unit holder does not comply with the Order then the owner will be in breach of the order and may be prosecuted. The problem is particularly acute in the case of absentee landlords. Hence, if a tenant is served with an order, it is paramount that the absentee landlord be notified immediately and that land lord if abroad will need to steps to comply.
Once the Respondent is served with an Order, a carefully thought through team of experts needs to assembled post-haste. Prudence will dictate that once a property owner is served with an Order, a fire engineer will be appointed immediately along with a construction lawyer who is well versed in the machinations of the Victorian Building Act 1993.
The team will then analyze the terms of the order and, immediately, contact will be made with the MBS or, in circumstances where the VBA has assumed the role of the MBS, contact will be made with the VBA representative. The fire engineer will conduct an inspection; hence the property owner or its agent will need to make thus affected properties available for inspection. The lawyer or the property owner’s representative may well negotiate with the MBS for an extension of time, whereupon the MBS will extend the period of time for compliance of the order. Alternatively, one of the affected party’s may choose to apply for a modification of the regulations through the BAB (see below).
If the fire engineer is able to establish that the building actually complies with the BCA and can satisfy the MBS on point then the MBS is at liberty to lift the order and life goes back to normal. If not, and the ‘ante’ has to be ‘upped’ the fire engineer will after having completed a diagnostic report, generate a rectification methodology and program for the consideration of the MBS. It is paramount that the property owner and the MBS are reasonable and cooperate in the ‘engineering’ of the solution. The solution might dictate that the rectification methodology requires some urgent things to be done as a precursor to longer term compliance solutions.
Logistical considerations may dictate that in many scenarios the MBS extends the time parameters of the order to ensure that sufficient time is afforded for the property owner to master the resources to regularize matters. This will not occur over night as it will entail:-
- The fire engineer carrying out an inspection along with diagnostics and then the engineer will fashion a rectification methodology that will be given to the MBS.
- There may be 2 phases to the rectification regime. Firstly if the building poses an imminent danger i.e. an Emergency Order scenario, the MBS will be vitally concerned about the implementation of an immediate rectification regime that will arrest the potential for injury to life and limb.
- Once ‘clear and present danger, is removed, a phase 2 will most likely be traversed i.e. submissions that shed light on the long term solution.
- A builder will need to be appointed to undertake the rectification regime. The property owners through the body corporate may have to raise a special levy or dig deep in to the pockets of the strata community finances.
- A RBS will need to be appointed to issue a building permit for the proposed rectification regime. Although if there is an emergency scenario, the Act will not necessarily require a remedial works building permit to be issued if the magnitude of the danger and its imminence dictate that immediate work must be deployed to remove the hazard.
This regime is not dissimilar to the methodology to be followed once a fire engineer is briefed that is enunciated in the Society of Fire Safety Practice March 2019 guidelines Façade/External Wall Fire Safety Design, where it is stated that there will be:-
- Initial review
- Detailed assessment
- Remedial measures and rectification works
It goes without saying that a significant deployment of high level technical expertise is required, coupled with the fact that whenever the writer’s firm is engaged to assist with the regularization of such matters, the firm from the outset works closely with a fire engineer. In the writer’s experience, the regulators are reassured if fire engineers of very senior standing are deployed – that gives them a measure of comfort.
On point, the writer spoke with Doctor Jonathon Barnett, a fire engineer of local and international standing. The writer has been a fellow speaker at a number of fire engineering conferences in Victoria, Queensland and NSW. Dr Barnett provided the writer with a rapid response methodology that he applies when briefed by a property owner to advise on how best to respond to building notice or Building Order re cladding. Doctor Barnett stated our:-
“Generic response is:-
- if the building is less than 10 years old in Victoria, hire a lawyer so all correspondence is protected
- Hire a fire engineer to do the following:
Stage 1 – Destructive testing and report
Review of existing documentation:
- Occupancy Permit and any other compliance documents such as the Fire Engineering Report
- PDF plans of the premises (preferably as-built drawings)
Preliminary site inspection and selection of area(s) for destructive testing
Supervision of removal of cladding and insulation (removal of samples by Basic Expert)
Coordination with a NATA approved laboratory for testing if required A brief summary report of findings, suitable to meet the requirements of the Insurer.
Stage 1a – Detailed Essential Safety Measures (ESM) audit if required
This is usually a required step based on the Stage 1 evaluation and will help pre-empt future actions by the council.
The audit is an enhanced ESM evaluation that uses the methodology specified in AS 4655-2005 Fire Safety Audits.
Stage 2 – Initial fire engineering assessment
This is the initial identification of the risk profile. This is useful in discussions with the Council to help ensure they identify the real issue(s) if any.
No report provided.
Stage 3 – Coordination with stakeholders including the client, insurers, and the council, and perhaps a builder.
In general, the analysis process done in Stages 1 and 2 will follow the Society of Fire Safety Practice Guide published by Engineers Australia in February 2019.”
It is interesting to note that Doctor Barnett said ‘brief lawyers from the outset’. There are those that are of the view that fire engineers will suffice to resolve matters by themselves; they are very courageous. The writer cautions fire engineers to avoid the dark arts of “bush lawyering” and in like vein stay within the parameters of their expertise. Even though interpretation of the BCA requires high level technical skills, the BCA cannot be read in isolation of the Building Act and the regulations and the latter is the domain of the lawyer. It follows that a lawyer should be deployed to ensure that the non-technical aspects of the regulation are understood and applied. It pays to punch within one’s weight division and although it has been the practice for some technical consultants to appear sans lawyer advocate, the writer would never advocate this; there is simply far too much at stake in the conundrum that is ‘fire compliance remediation’. In short: stick to your core competencies. The fact that someone of Dr Barnett’s standing highlights the need for legal deployment from the outset is sobering for those ‘men for all seasons’ i.e. those intent on being all things to all people.
What does an Owner do, if the time for compliance with the Building Order is close to expiring and the RBS has not accepted a compliance submission?
As previously stated, the RBS will need to be satisfied that the rectification methodology is such that it will remove any possibility of an unsatisfactory outcome. It is thus by no means a given that the RBS will be persuaded that the fire retardant remediation procedures will remove his or her worst case scenario palpable sense of anxiety. Conservative building surveyors find little comfort in accepting one side’s point of view, even if those views are compelling. The RBS will be mindful of having to explain the basis of a judgment under the blow torch of cross examination in a coronial inquest if things go awry. It is for this reason that a good many RBSs will encourage the respondent to appeal the matter to the BAB to ensure that the decision makers make an independent ‘un-pressured’ decision somewhat akin to a peer review. A cynic may say that this is risk migration – possibly, but being able to access the resources of an independent peer review of highly regarded decision makers to adjudicate upon matters of gravity has much to commend it.
So if the decision is made to apply to the BAB to ‘stay’ the operation of an order and or to have the matter independently ‘adjudicated’ one has to lodge an appeal with the BAB and one must ensure that this occurs before the time period stipulated in the Building Order expires.
A construction lawyer should be briefed to prepare the grounds upon which one is appealing, with the assistance of the fire engineer and when the matter is heard before the BAB the lawyer will in all likelihood ensure that he or she is accompanied with a technical advocate who will be a fire engineer who is held in high regard by peers of good repute. There will typically be an order for the expert to prepare an expert witness report and this should be in accordance with the VCAT expert witness guidelines.
The appeal will paralyze the import of the order, pending the outcome of the BAB hearing and will give the respondent time to get their affairs in order. Although the respondent can appear in person and elect not to be legally represented and instead be flanked by technical experts, the writer would reiterate earlier counsel and advise against this, because notwithstanding that both diagnostics and solutions will rely upon technical skill sets, there are nevertheless important points of law that come into play. For instance, an MBS’ overzealous expectation with respect to a technical solution may be cost prohibitive and in an environment where property owners may be financially over-committed and bereft of access to funds, there exists the very real possibility that they may not be able to afford an overzealous remedy. Furthermore, such is the sense of anxiety that has taken hold in the current fire retardant paradigm; some of the expectations on the part of officialdom reflect that level of anxiety. The building official understandably is worried about the possibility of having to be called to account in the event of fire, called to explain the basis of judgment and there is little doubt that this heavily weighs upon their law enforcement disposition. This can lead to ultra-conservatism and extreme design solutions.
The Building Act affords affected parties the ability to apply for a modification to the BAB
“Regard should also be had to the fact that an application may be made to the Building Appeals Board under section 160 for a determination that a provision of the building regulation does not apply, or applies with the modifications to a building specified in the application. Referral to the state government bodies such as the Victorian Building Appeals Board may be required by the appropriate authority and can be considered as meeting the peer review.”
The application may be made by the owner of a building or the purchaser under a contract of sale of or:-
- a Department Head;
- a public authority; or
- a municipal building surveyor.
The affected parties will be joined in the proceedings and each affected party will be required to file a Statement of Facts and Contentions that will enunciate the basis upon which judgments have been formed to justify design solutions or the rationale that was deployed with respect to the actors’ inputs. A fair bit of work goes into developing a statement of contentions. A collaborative effort between a fire engineer and a construction lawyer, along with (in some instances) an architect, in the writer’s experience, is the best way to approach this task.
Although the BAB may afford the affected parties to have the matter heard ‘on the papers alone’, without the parties appearing in person, the writer would advise against that.
Why so? Because it’s a bit like the line in the feted academy award film the Deer Hunter, where said deer hunter, played by Robert DeNero, much to the chagrin of his cohorts, said in determined and unwavering tone words along the following lines, ‘one shot, you’ve got one shot – so you don’t miss’. In the case of hearings of this derivation, there is much at stake in terms of the cost and the timing of rectification regimes. The respondent has to ensure that the design solution is the most effective in terms of generating an outcome that will on the one part ensure that those who will be domiciled within the building are safe and removed from harm’s way, but by the same token can engineer this outcome without incurring prohibitive costs. The best way to ensure that this happens – the way that leaves nothing to chance – is to request an order that the matter proceeds to a formal hearing before the BAB.
As the Board will typically comprise a senior lawyer and building surveyor and engineer of standing, there exists the complement of skill sets that is conducive to sound decision making. Experienced advocates know how to present the most compelling submissions and the high level interactivity and exchange between advocates and decision makers that tends to characterize BAB hearings is conducive to very impressive and decisive decision making.
About the Author
Kim Lovegrove RML FAIB, is a senior lawyer at Lovegrove Cotton Construction Lawyers, a past conjoint professor in building regulations and certification; was the principal legal adviser on the development of the Building Act 1993 and is regularly deployed as a senior law reform consultant to the World Bank whereupon the advises jurisdictions on best practice building control.
 3 VR 355, 358.
 Society of Fire Safety Practice Guide published by Engineers Australia, page 10.