Building Defects Reports
Sterlings offer professional, independent, comprehensive construction advice and reports on commercial, residential and industrial properties in a number of areas:-
Expert Witness Reports
An expert is a person who has specialised knowledge based on the person’s training, study or experience and who give evidence of an opinion based wholly or substantially on that knowledge.
Sterlings have prepared a number of expert witness reports for owners, contractors and subcontractors for use in NSW Civil and Administrative Tribunal (NCAT), Local Court, District Court and Supreme Court and have prepared and presented cost estimates by way of Scott schedules for use by those authorities.
If you have become involved in a dispute regarding a building matter, and are seeking a resolution, contact Sterlings and we can assist.
Dilapidation Reports
A dilapidation building report is an inspection that is undertaken on an adjoining property prior to construction works commencing on a proposed development - with a written report, which normally includes photographs of a building or property.
Councils usually request a dilapidation report prior to commencing construction on commercial and domestic sites to establish the condition of pathways, kerbing, drainage, road and any other conditions of surrounding Council property prior to commencing any work adjacent. Bonds taken can be returned on completion of construction if no damage has been identified.
The proposed development works can include a new unit, commercial building, house, factory, commercial space etc. (particularly if the development involves works potentially undermining adjacent structures such as subterranean parking), and alterations to a retaining wall, demolition, underground tunnelling or road works.
Building Defects And Incomplete Works Reports
If you are involved in residential construction, then you need to be aware that there have recently been major changes to the NSW Home Building Act. The primary changes can be summarised as:-
- The new laws help to clarify what is a major defect, which is covered by a 6-year warranty. General defects that don't meet the 'major defect test' will continue to be covered by the standard 2-year warranty.
- Major defects are defects that:
- are in a ‘major element’ of the building AND
- prevent all or part of the building from being lived in or used for its intended purpose OR threaten the collapse or destruction of the building or part of it. - For disputes relating to defects, tribunals and courts need to consider rectification as the preferred outcome. Builders who seek to fix defects can't be unreasonably refused access to a property by the home owner.
- To prevent rectification work being stalled, NSW Fair Trading Inspectors, through a Rectification Order, can oblige consumers to pay the builder any money owed under the contract.
- The definition of completion for strata buildings has changed so that completion occurs on the issue of an occupation certificate allowing the whole building to be used and occupied.
- Licensees have a legal defence in proceedings for a breach of the statutory warranties if they reasonably relied on the written specialist advice of an independent professional engaged by the owner.
So, in relation to owners, owners corporations, property investors and strata managers, a defect will no longer attract a six year statutory warranty period if it merely causes physical damage to a building or is located in part of the external walls or roof of the building (as is the case in many traditional façade and wall/floor cracking defects). Similarly, although internal/external waterproofing and fire safety are now more likely to attract the longer six year warranty period, this will not be the case where they do not result in part of the building being unusable or destroyed.
It is critical that owners and owners corporations perform a thorough investigation before two years are up. If in doubt about whether a major defect exists, you should commence proceedings before the two year mark, otherwise you run the risk of your claim being barred. Office bearers' insurance will not always protect executive committee members who fail to do this, particularly if they wilfully disregarded their obligations.
There is a clear shift towards resolving disputes by allowing developers, builders and tradespeople back to rectify defective works. This is evident in three initiatives:
- When a breach of the statutory warranty becomes (or should have become) apparent, owners must make reasonable efforts to notify the responsible person (i.e. a developer, builder and/or tradesperson) within six months. Owners then have a duty to allow reasonable access for rectification. Owners also have a duty to mitigate or minimise the damage caused by the defect.
- Courts and tribunals are now required to prefer rectification over other orders (such as monetary compensation). They have new powers to set out stages for rectification work and/or a date for compliance. They can even order rectification if the owner doesn’t want it and demands money.
- A separate contract of insurance is not required in relation to the rectification work where the first policy is still in effect (this won’t always be the case because of the end date of the policy) and where the rectification is being done by the same person as the original work (again this won’t always be the case).
It is important for owners to have solid processes for checking for defects every six months, notifying the developer, builder or tradesperson promptly if anything is found and mitigating any resultant loss (including to any tenant’s property).
Sterlings have the knowledge and experience to inspect residential houses and strata property to ascertain whether defects exist and to prepare reports for rectification or dispute.
