Commissioner’s lifeline on new-build defects

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Owners corporations in relatively new buildings deciding whether to fix building defects themselves or take recalcitrant developers to court – at huge expense and with no guarantee of success – have been offered a lifeline by NSW Building Commissioner David Chandler.

Boosted by sweeping new powers that came into force on September 1,  Mr Chandler says he is willing and able to order rectification on residential towers under six years old with existing problems.

“When the owners come forward and say ‘We’ve got problems’ I now have powers to go into those buildings, powers to call in the documents that are relevant to the building,” he told David Bleby in a story in the Australian Financial Review.

“This is the first time we’ve had powers to go into existing buildings up to six years old and, in extreme cases, up to 10 years old,” he added.

The process requires owners to flag their problems with the Office of Fair Trading. But if they can show they have defects and that the developers are reluctant to fix them, members of the Commissioner’s strata strike force can investigate and issue rectification orders, Karen Stiles, Executive Officer of the strata owners’ peak body Owners Corporation Network says in the latest Flat Chat Wrap podcast.

“For [the commissioner] to be able to arbitrate defects rectification in buildings up to six years old, including an independent scope of works, timeline and sign-off, would be a godsend for those affected owners,” Ms  Stiles told the AFR.

“Until now, owners in multi-storey apartment buildings have rarely notified NSW Fair Trading, seeing that more as handling relatively small dollar disputes in stand-alone buildings and such,” she said.

“The fact that no reliable complaints records have been kept is also off-putting. So, reluctantly, owners have been dragged down the expensive and exhausting litigation route. The unnecessary burden on owners and the community is incalculable.”

So far Mr Chandler’s focus has been on future or in-progress developments and he  has put four developers on notice under sweeping new powers, telling them his office will audit their apartment projects to make sure they are up to scratch and won’t allow them to complete their sales if they don’t comply.

Laws passed in June and enacted this month allow the commissioner to require selected developers to give six months’ notice of their planned completion date and undergo a series of monthly inspections leading up to completion.

The first occupation certificate audits are in Wollongong, western Sydney and the Hunter region  and will be followed by another six next month. 

“We’d expect to be receiving 100-120 notices a month going forward and we’d be expecting to see eight to 10 projects in a typical month to commence an OC audit,” Mr Chandler told the AFR.

Developers who resist demands that they rectify defects after Fair Trading reports could see themselves tainted in the main thrust of Mr Chandler’s efforts to clean up the strata building industry, in which a notional 20 per cent of developers with bad records will find themselves under intense scrutiny from Fair Trading inspectors.

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