Strata property ownership in NSW presents various challenges. Owners often face issues with defects, repair costs, and conflicts within the owners corporation. The Design and Building Practitioners Act 2020 (DBP Act) aims to address some of these concerns.
Implemented on 1 July 2021, the DBP Act is a legislative response to the ongoing issues of strata defects and related disputes in NSW. Its primary objectives are to reduce the occurrence of defects and improve safety standards in strata properties.
This article examines the key concept of ‘Building Work’ as defined by the DBP Act. We’ll explore how this legislation aims to enhance protections against strata defects and potentially improve the quality of strata living.
Understanding the implications of this Act may help strata owners better navigate property ownership and maintenance challenges in NSW.
Defining “Building Work” in the Design and Building Practitioners Act 2020
The DBP Act provides a clear definition of ‘Building Work’ in Sections 4 and 36.
Section 4 offers a broad interpretation, including:
- Construction, alteration, addition, repair, renovation, or protective work on:
- Class 2 buildings (residential apartments)
- Class 3 buildings (boarding houses, hostels)
- Class 9c buildings (residential care facilities)
- Coordination or supervision of these activities
Section 36 narrows the definition for Part 4 of the Act, which deals with the duty of care for design and building practitioners. Here, ‘Building Work’ aligns with ‘residential building work’ as defined in the Home Building Act 1989. This includes:
- Constructing or altering a ‘dwelling’ (any structure or part designed for residential use)
- Repairs, renovations, improvements, or protective treatments to dwellings
- Specialised work related to dwellings
This comprehensive definition ensures the Act covers a wide range of residential construction and maintenance activities.
Strata Buildings and the Design and Building Practitioners Act in NSW
The DBP Act indeed covers strata buildings in NSW, with a focus on Class 2 buildings. These typically include multi-unit residential structures common in strata schemes.
The Act provides specific provisions for Class 2 buildings, including:
- Enhanced duty of care requirements
- Stricter compliance measures
It’s worth noting that mixed-use strata properties, which combine residential and commercial elements, are also protected under the DBP Act. The Act’s coverage extends to the residential components of these buildings.
These provisions aim to address issues specific to strata properties and improve overall building quality and safety standards.
Strengthened Safeguards Against Strata Defects in the Design and Building Practitioners Act
The DBP Act aims to improve accountability in the design and construction of residential buildings in NSW. It introduces several key measures:
- New duty of care for design and building practitioners
- This extends practitioners’ responsibilities towards property owners
- Personal liability for defects
- Practitioners may be held individually accountable for building flaws
- Enhanced obligations and compliance requirements
- Design and building practitioners must adhere to stricter standards
- Increased disciplinary oversight
- The Act establishes a framework for monitoring and regulating industry professionals
These provisions work together to raise standards in residential construction and provide better protections for strata property owners against defects.
1. New Statutory Duty of Care for Design and Building Practitioners
Section 37 of the DBP Act introduces a significant duty of care for design and building practitioners and professional engineers. It states:
“A person who carries out construction work has a duty to exercise reasonable care to avoid economic loss caused by defects: in or related to a building for which the work is done; and arising from the construction work.”
This duty requires professionals to:
- Exercise reasonable care in their work
- Avoid causing economic losses due to building defects
‘Economic loss’ includes:
- Costs of rectifying building and strata defects
- Reasonable costs for alternative accommodation, if necessary
Importantly, this duty of care applies retrospectively:
- It covers losses discovered within 10 years before 11 June 2020
- Strata properties completed on or after 11 June 2010 are protected
This provision aims to enhance accountability and provide broader protection for strata property owners against defects and associated costs.
2. Personal Liability for Defects
The DBP Act extends personal liability for building defects to a broader range of individuals involved in construction, including:
- Directors
- Supervisors
- Project managers
- Developers
Recent court decisions have reinforced this principle:
- Goodwin Street Developments Pty Ltd atf Jesmond Unit Trust vs DSD Builders Pty Ltd (in liq) [2022] NSWSC 624
- The NSW Supreme Court held a builder’s project manager liable for defective works under the DBP Act
- The Owners – Strata Plan No 84674 v Pafburn Pty Ltd [2022] NSWSC 659
- The court found the developer liable under the DBP Act
- Importantly, the court noted that liability could extend to those who could have controlled the construction work, even if they weren’t directly in control
These rulings expand the scope of responsibility in construction and strata developments, aiming to enhance accountability and quality in building practices.
3. Enhanced Obligations and Compliance for Design and Building Practitioners
The DBP Act introduces key changes to improve construction quality:
- Professional Registration
- All design and building experts must register on a public list
- Ensures transparency and verifies qualifications
- Mandatory Design Documentation
- Design practitioners must submit detailed plans before construction
- They must certify that designs meet established standards
- Safety and Compliance Certification
- Builders must verify adherence to the Building Code of Australia
- Certifiers must have adequate insurance
These measures aim to:
- Enhance quality and safety in strata building construction
- Improve traceability of responsible professionals
- Facilitate faster issue resolution and accountability
By implementing these requirements, the DBP Act strives to create a more robust and transparent construction process for strata properties.
4. Enhanced Disciplinary Oversight
The DBP Act empowers the Secretary of the NSW Department of Customer Service with significant disciplinary authority:
- Actions against registered practitioners:
- Imposing fines
- Suspending licences
- Direct intervention in ongoing projects:
- Issuing ‘stop work’ orders when:
- Projects violate the DBP Act
- Significant risks are identified to:
- Public safety
- Future residents
- The property itself
- Issuing ‘stop work’ orders when:
This oversight strengthens the enforcement of construction standards and prioritises public safety. It provides a mechanism for swift action when violations or risks are detected, helping to maintain the integrity of building practices in strata developments.
Conclusion
The Design and Building Practitioners Act 2020 represents a significant step in addressing the increasing prevalence of strata defects in New South Wales. This legislation aims to enhance accountability across all stages of strata scheme design and construction.
Key impacts of the DBP Act include:
- Expanded rights and remedies for strata owners
- Increased regulatory and compliance requirements for design and building professionals
- Enhanced protection against defects through new duty of care provisions
- Personal liability for practitioners involved in defective work
- Stricter oversight and enforcement mechanisms
These changes affect various stakeholders in the strata sector, including lot owners, owners corporations, and design and building practitioners. Understanding and complying with these new regulations is crucial for all parties involved.
As the strata landscape continues to evolve under this legislation, staying informed about your rights and responsibilities is essential. Consider consulting with legal experts specialising in strata law to navigate these changes effectively and ensure compliance with the new standards set by the DBP Act.
