amca presentation some recent legal updates...• strata schemes management act • ep & a act...
TRANSCRIPT
18 October 2017
AMCA presentation
Some recent legal updates
David Glinatsis
Director
I N D U S T RY S E C T O R S
Our lawyers have expertise and experience in the following industry sectors
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• Security of Payments Australia wide.
• Contract negotiation.
• Contract terms and conditions.
• Legal issues relating to BIM.
• BIM and construction Contracts.
• Contract administration and risk mitigation.
• Managing Building and Engineering Contracts.
• Strata legislation and issues.
• Record keeping.
• Dispute resolution.
• Legal issues in the management and resolution of Delay
and Disruption.
• Liability for defective work.
Kreisson regularly provides updates, though leadership and education on legal developments
and topics in the construction and engineering industries including:
Security of Payment
What the Courts are saying? Current reviews and
issues 10 Nov 2017 Regal Consulting Services Pty Ltd
v All Seasons Air Pty Ltd,
“[All Seasons] shall claim payment progressively in accordance with Item 37…[a]n early progress claim shall be deemed to have been made on the date for making that claim” [Clause 37]
Deeming provision is a contractual fiction
Valentine’s Day
14 Feb 2018
Probuild Constructions (Aust) Pty
Ltd v Shade Systems Pty
Ltd [2018] HCA 4.
Court only has jurisdiction to quash an
adjudicator’s determination for jurisdictional
errors.
Valentines Day
14 Feb 2018
Maxcon Constructions Pty Ltd v
Vadasz [2018] HCA 5
“pay when paid” - a provision in a contract that:
“makes the liability to pay money or due date
for payment contingent on or dependent on the
operation of another contract”
Security of Payment
In December 2015 a Discussion
Paper was released by the NSW
Government
Called for responses to various
questions about the security of
payment law and its operation
Submissions as to the Discussion
Paper (closed on 26 February
2016)
Further targeted consultation and
research as necessary
Report to the NSW Government
Awaiting outcome
Where are the reviews up to? Current reviews and issues
Security of Payment
Murray Review
21 December 2016 Commonwealth Government
announced that it had appointed John Murray AM
to conduct a review of the SOPL throughout
Australia
22 August 2017, “Issues Paper”
30 September 2017, a progress report as to the
Review was provided to the Minister for
Employment
Final report - 31 December 2017
Where are the reviews up to? Current reviews and issues
Security of Payment
Publication of adjudicators’ determination;
Court’s power to sever and remit;
Statutory trusts to further protect subcontractors;
Adjudication for domestic construction;
Special mechanism for small business; and
Acts of intimidation and retribution.
Security of Payment
Non-conforming Products
Who could be liable?
• Approved use of Alucobest
• Issued Building Permit
• Failed to stipulate no storage on balcony
surveyor
• Was responsible for choosing claddingarchitect
• Failed to “exercise reasonable care not to create a fire hazard in the use and occupation of the
unit.”
tenantBuilder
Owners Corporation
Orders to rectify
Builder is reported to have alleged that:
Lacrosse Fire – A case study
http://www.afr.com/real-estate/lacrosse-builder-lu-simon-says-architect-elenberg-fraser-failed-on-cladding-20170929-gyrldk
http://www.abc.net.au/news/2017-09-16/docklands-cladding-fire-apartment-owners-in-legal-minefield/8948374
The Grenfell fire
Who could be liable?
https://www.standard.co.uk/news/london/individuals-may-face-criminal-grenfell-charges-says-prosecutor-a3605581.html
Corporate Manslaughter
Gross Negligent Manslaughter
Civil claims – wide range of categories
May include breach of contract, insurance claims, tort, breaches of statutory duties (under health and safety laws) against individuals or corporate bodies brought by victims or their estates or former tenants.
As at end February 2018
NSW Qld SA WA NT Vic ACT TAS
Taskforce established
Dept of PlanningTransp. and Infrast.
Building Comm.
No
AUDIT
No. of buildingspotentially affected so far/warrant further consideration /priority
Over 1,000
Note 1
Focus on 1994-2004
Note 2
77
Note 3
229
as at02/18
Note 4
1400
Note 5
43
[42 of 43 – low risk]
As at Jan 2018
Note 6
NewLegislation
No No No No No
Notes
1 http://www.fairtrading.nsw.gov.au/biz_res/ftweb/pdfs/About_us/Whats_new/NSW_Gov_Fire_Safety_and_External_Wall_Cladding_Fact_Sheet.pdf
4 https://www.commerce.wa.gov.au/publications/state-wide-cladding-audit-status-update
2 http://statements.qld.gov.au/Statement/2017/6/30/queensland-stands-up-audit-taskforce-to-conduct-targeted-investigations-of-buildings
5 http://www.vba.vic.gov.au/cladding
3 4,500 buildings of two storeys or more, with 77 buildings listed for further checksSee para 2.36 Senate Economics References Committee Non conforming building products Interim report: Aluminium composite cladding page 14
6 http://www.justice.tas.gov.au/__data/assets/pdf_file/0018/403029/Tasmanian-Aluminium-Composite-Panel-Audit-Summary-2018.pdf
Cladding and Non conforming products
Overview
Commenced 1 November 2017
• Amends Queensland Building and Construction Commission Act 1991 (QBCC Act) and other Acts and Regulations
• Non conforming Building Products Code provides guidance
• Expands compliance and enforcement powers of QBCC
• Chain of responsibility
• Non transferable duties
• Notification requirements
• New offences of up to $126,150
Key concepts
• Building product – s74AB(1)
• Non conforming building product for intended use – s74AB(2)
• Safe – s74AA
• Safety risk – s74AA
• Reasonably practicable – s74AA
Likelihood, harm, knowledge, availability and suitability, costs
• Persons in the chain of responsibility
Designers Manufacturers Importers Suppliers Installers
What are the key duties under the Act?
• (Primary duty) that product is not non conforming for intended use as far as reasonably practicable.
• (Additional duty) - provision of “required information”
• Comply with recall requirements
• Due diligence on Executive Officers
• Not make false and misleading representations
• Notification to QBCC of:
Non conforming product
Safety related incidents or concerns
Building and Construction Legislation (Non conforming Building Products – Chain of Responsibility and Other Matters Amendment Act (2017) (Qld)
QLD Reform :Non Conforming Products
QLD Reform - Supply Chain
Primary duty
That product is not non conforming for intended use as far as reasonably practicable
designer Manufacturer importer supplier installer
Additional duties - to provide “required information” for the product – see Code
Other duties:• comply with recall;• due diligence on Executive Officers;• not to make false and misleading representation; and• notify QBCC – notifiable incidents.
What is Intended use ?
Ref. Code
Step 1 - all aspects of the intended use
Step 2 - seek evidence that building product meets “deemed to satisfy”
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Building Products (Safety Act) 2017 - NSW
Key objectives
• prevent unsafe use of building products
• identify buildings using prohibited products
• require rectification of affected buildings
• Act prevails over NCC
Key terms
• “unsafe” safety risk
• “Safety risk” - if any occupants of the building are or will likely be a risk of death or serious injury from the use of the building product in the building
• “Building product”- any product or thing that could be used in a building
• Affected building – banned building product has been used in a building
• A Building is made safe if safety risk in affected building notice is eliminated as far as practicable
Key provisions
Increased powers to NSW Fair Trading
NSW Fair Trading may issue:• Product use ban• Affected building notices• General building safety notice
Rectification orders can be issued on owners of affected buildings
Amendments to other Acts and Regulations
• Home Building Act 1989 • Conveyancing (Sale of Land)
Regulation 2017• Strata Schemes Management Act • EP & A Act
Penalties
Corporation Individuals
Max $1.1m
$22,000 for directors
$220,000 or 2 years
imprisonment or both
$110,000 per day
offence continues
$44,000 per day for
individual
Background
• Act forms part of 10 point plan
• Commenced on 18 December 2017
• Part of wider reforms in NSW
Secretary NSW
Fair Trading
Product
ban
Investigation and
assessment of
Building products
Enforcement
Agency/Council
Owners corporation
Owner
Commissioner
of Fire
New obligations
• Contract for sale
• Strata Statement
• S149
Affected
building
Notice
Affected
building
Ban
ned
p
rod
uct
Inv
esti
ga
tio
n
Rectification
OrderGeneral
Order
Corporation Individuals
Max $1.1m
$22,000 for
directors
$220,000 or 2 years
imprisonment or both
$110,000 per day
offence continues
$44,000 per day for
individual
NSW Reform – product bans
Importer
Managing the Legal Risks
Designer Manufacturer Supplier Certifier
Qld - Multiple duties for designer, manufacturer, importer, supplier and installer
Installer
Specifier,Designerspecification Certifier
SaleProduct to site
suitabilityBuilding Work
Defect Liability Period
Relevant state and territory legislation governing the building approval process including licensing and WHS requirements
Home
warranty
schemes
National Construction Code and relevant jurisdictional requirements
Elements of the Australian Consumer Law (generally deceptive or misleading product provisions) – these can be privately litigated and also litigated by ACL
regulators or the ACCC
Builders, design professionals – duty to act with reasonable care and skill, breach of contract, breach of statute, breach of professional regulations
Modified from EESS “Non Conforming Building Products Report” App.3 – “Building Product Supply Chain Strategies to Address Risks related to Non Conforming Building Products"
Border
Legislation
Watermark
Thank you