In February 2019 the NSW Government released its

response to the Shergold Weir Building Confidence Report

(“NSW Response”).1

In February 2018 Peter Shergold and Bronwyn Weir

released their report entitled “Building Confidence:

Improving the effectiveness of compliance and enforcement

systems for the building industry across Australia” (“Building

Confidence Report” ).2

This Building Confidence report was commissioned by the

Building Ministers’ Forum which is a group of Australian,

State and Territory Ministers that have responsibility for

construction and building matters. The Report responded to

various recent construction related incidents including the

Lacrosse building in Melbourne (click here to read earlier

articles) and the Opal Tower building in Sydney Olympic

Park.

The Report did cover commercial construction as well as

high rise residential construction so the changes the NSW

Government intends to implement now will have a wide

effect.

RECOMMENDATIONS MADE

The Building Confidence Report made 24 recommendations

and reviews compliance issues in the construction industry

at state, national and international levels. The NSW

Government has prepared its response in order to

implement the following relevant changes for NSW:-

1. Appoint a Building Commissioner

2. Overhaul Compliance Reporting

3. Require building practitioners with reporting

obligations to be registered:

4. Ensure that there is an industry wide duty of care to

homeowners

APPOINTMENT OF A BUILDING COMMISSIONER

The Response confirms that the NSW Government intended

to appoint a Building Commissioner who will act as the

consolidated building regulator in NSW and administer all

building laws, including:-

licensing and authorisation of building practitioners;

residential building investigations;

building plan regulation and audit;

residential building inspections and dispute resolution;

plumbing regulation;

electrical and gas safety regulation;

strata building bond scheme;

building product safety;

building and construction security of payment scheme;

and

engagement and strategic collaboration with local

government.

The Building Commissioner will have strong investigative

powers to scrutinise any wrongdoing in the industry as well as

disciplinary powers and conduct risk based audits of

practitioners and documents.

OVERHAUL COMPLIANCE REPORTING

All building practitioners will be required to submit all building

plans to the new Building Commissioner. Those building

practitioners will have to declare that their plans comply with

the BCA. It will be an offence to dishonestly or recklessly

declare inaccurate plans or fail to lodge documents in time.

“Building Practitioners” includes building designers, architects,

engineers and other persons who provide final designs and /

or specifications of elements of buildings.

Whilst certifiers, architects and residential trades are generally

certified in NSW – engineers, draftsmen and commercial

builders and trades are not currently subject to any registration

schemes.

Certifier laws were recently strengthened by enacting the

Building and Development Certifiers Act 2018 (NSW). The

NSW Response will go beyond certifiers alone in order to

improve compliance with the BCA as inspections alone are not

sufficient to ensure compliance.

REQUIRE BUILDING PRACTITIONERS WITH REPORTING

OBLIGATIONS TO BE REGISTERED

The NSW Response confirm that building practitioners will

need to be registered and those practitioners will have to

maintain the necessary skills and insurance to meet

registration requirements.

Only authorised practitioners will be entitled to declare plans

comply with the BCA to the Building Commissioner.

ENSURE THAT THERE IS AN INDUSTRY WIDE DUTY OF

CARE TO HOMEOWNERS

The NSW Government Response also confirms that it will

ensure that building practitioners owe a common law duty of

care to owners’ corporations and subsequent residential

homeowners as well as unsophisticated development clients.

Whilst it is established that residential building owners have

protections for damage suffered as a result of a failure to

exercise a duty of care during construction there is a

ambiguity arising from High Court decision of Brookfield

Multiplex Ltd v Owners Corporation Strata Plan 61288

[2014] HCA 36 (8 October 2014)3 as to whether builders

and designers owe a common law duty of care to residential

owners corporations and purchasers for defects. The

proposed changes are intended to rectify this ambiguity and

protect all owners uniformly where any building practitioner

fails to take reasonable steps to prevent foreseeable risks

of damage arising from defects in a building.

SUMMARY

The NSW Government is going to conduct further

consultation with industry and community stakeholders re

the proposed reforms.

The proposed reforms are going to result in extensive

changes for various building practitioners with the

requirement to be registered and the requirement to report

to the Building Commissioner to be appointed. The

increased scrutiny and reporting and registrations

requirements will be rigorous and all building professionals

should keep abreast of the imminent reforms.

David Glinatsis (Director, Kreisson) and Catherine Lucas

(Solicitor).

1 https://www.fairtrading.nsw.gov.au/__data/assets/pdf_file/0007/451375/

Response-to-Shergold-Weir-Building-Confidence-Report.pdf

2https://www.industry.gov.au/sites/default/files/July%202018/document/pdf/

building_ministers_forum_expert_assessment_-_building_confidence.pdf

3https://www.austlii.edu.au/cgi-bin/viewdoc/au/cases/cth/HCA/2014/36.html?

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