Articles

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

Recent building law reform changes to the provisions in the Building Act 1993 have marked a strengthening of enforcement tools and powers to ensure compliant construction in Victoria.  It is hoped that this will lead to better constructed buildings with improved quality and less risk to health and safety.

 

This is of key importance in this era of increased high rise apartment living, risky aluminium composite cladding, and problems posed by water entry and suspect water-proofing (for example, with apartment balconies).

 

There are new provisions now in the Building Act 1993 which better specify the use of ” directions to fix building work “, that can be given verbally or in writing by the relevant building surveyor (“the RBS”).  These directions are given to the Builder, or to the person apparently in charge of building work at the site.

 

This marks an improvement and more clarity to the previous section 37 (prior to the amendments), which was a brief stand-alone provision that allowed for directions made by an RBS to the person apparently in charge of the building work at a site. If the directions were given verbally, they had to be confirmed in writing promptly thereafter.  If the directions were not complied with, there could be an escalation to a Building Notice.

 

In practice, directions to fix building work were probably under-utilised by building surveyors and it was more common to have Building Notices or Building Orders issued by either Council or private building surveyors.

 

It is obviously hoped by the regulators that the addition of more sections (ie sections 37A to 37E) and the introduction of the Victorian Building Authority (“the VBA”) into the mix as an entity that can give such directions, will lead to an increased use of building directions rather than just relying on Building Notices or Orders.

 

The advantage of the directions process is that the Owner of the land, who can often be disinterested or non-involved in the construction process, is bypassed and the directions are served in a straight line on the Builder or a person “who is apparently in charge of the site on which the building work is being carried out”.

 

On the other hand, Building Notices and Building Orders are generally required to be served on the Owner of the land where the works are performed.  That person then has to approach their Builder and seek rectification, when often the Builder can be the real entity at fault, with matters complicated if the Builder and Owner are in some form of contractual dispute at the time.

 

Fitness for occupation and regulatory compliance are linked inextricably to health and safety. These concepts should not be clouded by contractual disputes between Owner and Builder, or other construction practitioners.

 

Section 37B of the Act was introduced as part of Division 2 of Part 4, which was introduced by the Building Legislation Amendment (Consumer Protection) Act 2016.  The section reads, in its first two sub-sections:

 

“(1)   This section applies if, after the inspection of building work, an authorised person believes on reasonable grounds that the building work fails to comply with this Act, the building regulations or the building permit issued in relation to the building work.

 

(2)    The authorised person may give a direction to fix the building work to a relevant person in accordance with this division.”

 

Pursuant to section 37 of the Act, “authorised person” is defined to mean “the Authority” (meaning the VBA), or a VBA inspector. Whereas the definition of “relevant person” means “a person referred to in section 37C who can be, or has been, given a direction to fix building work.”

 

Under section 37C of the Act it is said that a direction to fix building work can be given as an oral direction to either or both of “the builder” or “the person who is apparently in charge of the site on which the building work is being carried out”, or it can be given as a written direction to the Builder.

 

Note also that a recent decision of the Supreme Court accepted the main submissions from the Builder to the effect that the legal power to issue the direction to fix under s37B is confined to a specific period or phase.

 

This finite phase is the actual building period commencing from when the Building Permit is approved and up until the issue of an Occupancy Permit or Certificate of Final Inspection.

 

In that case, the Builder successfully argued that a direction to fix given by the Victorian Building Authority could not be served at a time that was several years after the works had been completed and an Occupancy Permit approved.  Therefore the direction was not upheld by the Court, in what was a positive outcome for the Builder.

 

I offer this quick precis of the main provisions that have been introduced to ‘beef up’ the directions process as an enforcement tool.

 

Section 37A says that, if after the inspection of building work the RBS believes “on reasonable grounds” that the work fails to comply with the Act, the building regulations (including the Building Code) or the Building Permit, then the RBS must give a direction to fix the work to a “relevant person”.

 

In addition, the RBS may authorise a building surveyor or a building inspector whose registration under Part 11 authorises the inspection of that building work to give an oral (ie verbal) direction to fix the building work.  That oral direction is to be given to the “relevant person” on behalf of the RBS.

 

As described above, the definitions of “relevant person” and “authorised person” are set out in the new section 37.  The umbrella of “relevant person” is as expected and consistent with the original section 37, but “authorised person” which includes the VBA or a VBA inspector is a marked shift that now allows the VBA to give such directions, rather than just the RBS for the site.

 

Section 37B refers to directions “by authorised person to fix building work” and is described more fully above.  Note that if such a direction is given by the VBA, then this new direction will supersede any earlier direction given by or on behalf of an RBS under section 37A.

 

What does “the enforcer” do if an oral direction is not complied with?  Pursuant to section 37D, the RBS or the “authorised person” (ie the VBA or its inspector) must then give the Builder a written direction to fix the building work, IF the RBS or the authorised person is not satisfied at the end of the prescribed period after the oral direction was given that that the work is now compliant.  Based on subsection (3) the “prescribed period” means any period prescribed by the regulations, or in the absence of such prescription 7 days.

 

Finally, section 37E specifies what directions to fix building work can require the recipient to do.  The section says that the directions may compel the relevant person to:

 

• carry out work so that the building work then complies wholly or substantially with the Building Act, the Regulations and the Building Permit (“rectification”); and/or
• stop any further work that may prevent the building work the subjection of the direction from being properly inspected, until the RBS or authorised person is satisfied that the rectification has been adequately conducted.

 

For further advice or assistance in relation to building law matters including construction disputes and building regulation, do not hesitate to contact a legal team with expertise in this area.

 

Lovegrove & Cotton Lawyers to the building industry

For thirty years, Lovegrove & Cotton have represented builders, building surveyors and building practitioners in Melbourne, Canberra, Sydney and Queensland. Justin Cotton is a leading Australian construction lawyer and widely respected in the building fraternity as evidenced by his appointment as Chairperson of the HIA Industrial Relations and Legal Services Committee, and member of the Regional Executive Committee, for HIA Victorian Chapter. Lovegrove & Cotton can help practitioners resolve any type of building dispute and are preeminent in the area of building practitioner