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A decision in October 2024 by the Victorian Building Appeals Board has applied a pragmatic and holistic approach to the acceptance of combustible cladding affecting a multi-apartment tower building in the central city.  The writer had conduct of this proceeding on behalf of an Owners Corporation that was seeking a compliance assessment of ACP cladding panels on the building’s external façade. After approximately four years, a successful outcome was achieved for the Owners.

While the journey was a long one for the Owners Corporation and the compliance assessment journey took several years, the determination by the Board was that the retention of the combustible aluminium composite panels (that had a polyethylene core not exceeding 28%) that was installed on multiple elevations on the building, complies with the Performance Requirements CP2 and CP4 of the Building Code, and could be fully retained.

Between 2012 and 2014 the building had been redeveloped to create two towers in William Street, Melbourne connected by a sky bridge with residential apartments above, a hotel/motel, and commercial areas including offices and a shop at ground level.  The building is multi storey over 24 levels, plus two basement levels for carparking.  An Occupancy Permit was issued by the Building Surveyor on 26 September 2014.

After the original Occupancy Permit was amended in November 2017 following a supplementary fire engineering report form the project fire engineer, a Building Order was later issued by the Council on 13 November 2019.  This Order called on the Owners Corporation to: 

• remove or replace all the combustible ACP cladding on the building with a material that complied with the Building Code; or 
• to remove and replace that cladding so far as was reasonably practical and have that partial replacement approved in a compliance assessment at the Building Appeals Board.

The Owners Corporation for the building (known as “The William”) was forced to engage experts for fire engineering reports and to take the matter to the Building Appeals Board, with the Council, the Victorian Building Authority, Fire Rescue Victoria and some of the construction practitioners included as interested parties.

Expert Reports and available data suggested that all of the ACP cladding was Alpolic/FR, which is a product with a fire-retardant core, resulting in a highly flammable polyethylene core that comprised less than 30% of the overall core composition.  

The risk assessment by the first independent expert indicated that at least 35% of the total external façade consisted of the ACP cladding, which was a considerable quantity given the number of storeys and elevations, and the configuration was seen as unbroken in the vertical and horizontal external elevation.

Metal cavity barriers had been provided at each floor, which would assist to reduce the chance of fire spread in cavities.  Also, holistically the passive and active fire safety measures in the building were otherwise seen as positive, including in relation to paths of egress and a comprehensive fire sprinkler system throughout the building.

There was a Codemark Certificate that gave a conditional approval (at the time of construction) for the use of the Alpolic/FR as an attachment to the building, though there was some doubt about whether these conditions were sufficient or had been as comprehensive as current practices would require.

At some point in the process, the BAB proceedings were put on hold while an application was made to Cladding Safety Victoria (CSV) for funding for full cladding replacement.  Further testing and reporting on the building was conducted by CSV.  Their eventual decision was that the building was not seen as “high risk”, so it would not qualify for replacement funding.  The rationale for this was that the ACP (Alpolic/FR) had a fire-retardant core.

Meanwhile, because some of the key interested parties had maintained that the building with this cladding was indeed high risk to occupant safety (and hence the Building Order), the members of the Owners Corporation effectively found themselves to be “the meat in the sandwich” between two competing views of the building.  The matter had to be continued at the Building Appeals Board.

On the face of it the CSV decision may have seemed like a disheartening outcome for the Owners, however, the finding of the CSV that the building was not in fact “high risk” was then used as another point of argument in the BAB proceeding.

After expert conclaves on site, the re-engagement of the project fire engineer by the Builder, and both “small scale” and later “intermediate scale” testing of mock ups of the cladding and insulation that were administered by CSIRO, more comprehensive test conclusions were available by the end of 2023.

Early on in this review process it was discovered that polyester batts had been installed as insulation, which is a combustible material, within the cavity of the lightweight internal walls.  However, this was only found in some locations and the insulation was separated from the Alpolic/FR by sarking.  The wall panels containing this insulation and the ACP product had 90mm steel channels separating them from adjacent wall panels.

On 30 October 2023, the Omnii Cladding Assessment Report Revision was produced, and it concluded that that ACP cladding meets the performance requirements of CP2 and CP4 and avoids the spread of fire on the façade of the building to the degree necessary.  This was followed by a CSIRO Peer Review Report of the Omnii conclusions.  This found that all outstanding limitations and qualifications had now been resolved and no further testing / investigation was required – this was a key conclusion for some of the interested parties who had called for more testing of both the cladding and insulation.

Some of the findings of the Omii Report of 30 October 2023, which were seen as critical in the BAB determination, included that:

• Lab testing confirmed that the ACP has a core that is below 30% polyethylene;
• An extensive range of fire test data has shown that FR (fire retardant) type ACPs (for instance, Alpolic F/R panels) do not “readily propagate fire spread”;
• Insulation within the cavity of the lightweight external walls, between the plasterboard and the ACP panels is found to be combustible polyester batts, but such batts have been determined to be much less flammable when compared in testing with other insulation material like PIR foam;
• The small and intermediate scale testing demonstrated that use of the ACP configuration such as on this building would not result in undue fire spread vertically to the level above; and
• Therefore, the Report concluded that the ACP external wall system avoids the spread of fire to the degree necessary, and the Performance Requirements CP2 and CP4 were satisfied.

This Report was then followed by the CSIRO Peer Review Report on 10 November 2023 that effectively accepted these findings and conclusions.

During the hearing, the Victorian Building Authority argued that the 2019 version of the Building Code should be applied to the Board’s compliance assessment, because this was the applicable version when the initial application was made to the Board.  On the other hand, the Applicant had argued that the 2011 version of the Building Code applied, which was relevant at the time of construction and the issue of the first Occupancy Permit.  The Board found that the 2011 version was in fact applicable.

In the final determination, the Board accepted the submissions made on behalf of the Applicant to the effect that all of the ACP cladding could be retained on the building.  As part of this, the Board paid close regard to the findings in the final Omnii Report – after significant and extensive testing of the cladding system had occurred throughout 2023.

In concluding that the building complies with Performance Requirements CP2 and CP4 of the Building Code, the Board reasoned that:

• The presence of Alpolic/FR as an external cladding to the building presents a low risk to the spread of flame to exits, public corridors and sole occupancy units; and
• The retention of the Alpolic/FR (with the fire-retardant, less than 30% combustible core) does not “materially increase” the risk of fire spread to the façade or otherwise materially compromise fire safety.

In the second half of 2023, new practice notes / guidelines were issued calling on local authorities to work with Owners Corporations faced with combustible cladding issues and to try to find a pragmatic resolution.  This emphasised a less adversarial approach.  The pragmatic resolution could involve partial rectification, rather than mandating in Building Orders for full removal of all the combustible cladding.  

This perhaps reflects the reality of a limited pool of funds for the CSV to have recourse to for cladding rectification funding, and perhaps recognising that apartment owners were the innocent parties when inheriting the problems of non-compliant design.

This article is intended to be general commentary only and should not be relied on as legal advice.  For expert legal advice in relation to all construction law matters, do not hesitate to contact expert construction lawyers to seek assistance tailored to your specific needs.

By Justin Cotton, Director of Lovegrove & Cotton Pty Ltd

Disclaimer:

The information provided in this article is for general informational purposes only. It does not constitute legal advice. For specific legal advice related to building regulations and compliance, please consult a construction lawyer.