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Update on the proposed Design and Building Practitioners Bill

  • February 26, 2020

Previously, the “Design and Building Practitioners Bill” was halted from passing through the Upper House due to a need for significant amendments.

The “Design and Building Practitioners Bill” is now being suggested for re-introduction into Parliament, so that new compliance changes surrounding construction work can pass into NSW law.

What does it cover?

The Bill is proposed to only cover construction works on certain categories of regulated designs, and multi-unit and multi-storey residential apartment buildings. These specific categories will be outlined in the regulations when the Bill is enacted. Other classes of building are intended to be included over time.

Through this, the Bill will mainly target compliance from 2 specific classes of people:

  1. Design Practitioners – A person who prepares regulated designs
  2. Building Practitioners – A principal contractor under a building contract

What obligations are proposed by the Bill?

The Bill proposes to impose the following obligations:

  1. to require Design Practitioners, who prepare regulated designs, to declare that their designs comply with the Building Code of Australia; and
  • to require Building Practitioners
  1. to:
    1. obtain and rely on a regulated designs when building; and
    2. provide a compliance declaration that they have complied with the Building Code of Australia.

Any variations will need to be re-evaluated by a Design Practitioner and re-declared before performance is undertaken by a Builder Practitioner.

Design Practitioners and Building Practitioners will also need to be registered under a new registration scheme.

A New Duty of Care?

The proposed legislation will extend the duty of care that is owed by a builder to subsequent owners. The current common law position in NSW is generally that building contractors only owe a duty of care to initial owners and not to any subsequent owners. The proposed changes will see builders owe a duty of care to subsequent owners for defects resulting in economic loss.

What are the penalties involved?

Penalties have been proposed within the Bill, which range from 100 to 2000 Penalty Units for a person, and from 1000 to 3000 Penalty Units in the case of a corporation. The severity of the contravention will be considered in determining the appropriate penalty.

The Bill also proposes a term of imprisonment for a maximum period of 2 years for Design Practitioners and Building Practitioners who intentionally issue false or misleading compliance declarations.

Why is the legislation being re-introduced into Parliament?

New changes include ‘rating’ builders based on their track histories, and from this, blocking suspect builders from erecting high-rise unit towers. The new laws will grant powers to the NSW Building Commissioner to stop the building of defective apartment blocks by actions such as removing the Occupation Certificate.

It is proposed in the new regulations that builders and developers be given a rating according to metrics such as their previous workplace safety checks, customer complaints, age of their business, financial credibility and suspicion of phoenixing. The evaluation of these metrics will be calculated into a score, similar to that of a credit rating, and those builders with poor ratings will be flagged on a database to ensure their practicing is heavily examined.

The Design and Building Practitioners Bill will need to be enacted in order to legislate the above mentioned changes into the Regulations. These changes are currently not detailed in the halted Bill.

Bryce Richards

Bryce joined the Keystone team in July 2016. He completed a Bachelor of Economics and Bachelor of Laws/Diploma of Legal Practice at the University of Newcastle. Prior to joining Keystone, Bryce worked in the commercial litigation team of a large Newcastle based law firm. During his time in this role, Bryce gained significant experience in a variety of commercial disputes with a focus on the building and construction industry, insolvency and debt recovery. He regularly advises and represents clients at all stages of disputes, including in respect of claims made in the NSW Civil & Administrative Tribunal, Local Court, District Court and Supreme Court.