In June 2020, the NSW government enacted the Design & Building Practitioners Act 2020 (NSW) (Act). Section 37 of the Act extends the duty of care owed by builders to subsequent purchasers. We note that from 1 July 2021, the Act requires that registered practitioners, which includes design practitioners, professional engineers and building practitioners, issue compliance declarations. The declarations will include statements that the design complies with the Building Code of Australia and/or other regulatory requirements and the building work is in accordance with the design. There are significant penalties under the Act if the declaration is made by an unregistered practitioner or a false and misleading declaration is made.
In September 2020, the Victoria government introduced the Cladding Safety Victoria Bill 2020 (Bill). The Bill increases the current time limit to pursue legal action from 10 years to 12 years. The extension of time will give owners more time to pursue âcladding building actionâ against builders and building professionals and allows the government to recover costs associated with the government cladding rectification programme (Cladding Safety Victoria). A âcladding building actionâ means âa building action in connection with or otherwise related to a product or material that is, or could be, a non-compliant or non-conforming external wall cladding productâ. The extension of time will only apply where a âcladding building actionâ is statute barred between 16 July 2019 and 12 months after the new provision comes into effect.
In summary, the Bill:
The Bill is yet to be enacted but is anticipated to come into operation by 1 July 2021.
The recent Court decision and new legislation may result in increased exposure to claims for building professionals and their insurers.
Karen Wong
Claims Manager