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Use of Illegal Building Products

The fire which occurred at the Lacrosse building in Docklands on 25 November 2014 has focussed the attention of the Victorian building industry on the use of sub-standard building materials in the construction of apartment buildings in Melbourne. The Metropolitan Fire Brigade (MFB) found that the use of combustible external cladding, which did not comply with the Building Code of Australia, contributed to the rapid spread of the fire, from a balcony on the 8th floor to the uppermost 21st floor.

The Victorian Building Authority is investigating whether the cladding used at the building has been used elsewhere. Industry insiders have expressed concern that the use of the illegal cladding has been widespread. Concerns have also been raised about the use of other non-compliant, unsafe, and usually imported building products in multi-storey apartment developments, and by the Victorian building industry generally.

This raises a number of issues for owners of high-rise residential apartments, their owners’ corporations, and for strata managers.

Under the Building Act 1993 (Vic) (the Act) the local council’s municipal building surveyor is responsible for the administration and enforcement of parts of the Act. Where the municipal building surveyor forms the view that a building does not comply with the building regulations he or she may issue building orders to the owners corporation or to individual owners, obliging them to conduct works to rectify the defects and to make the building safe at their own cost.

A recent Victorian Supreme Court decision in favour of an Owners Corporation clarified that the consumer protection provisions in the Domestic Building Contracts Act 1995 (Vic) do extend to high rise apartments (Burbank Australia Pty Ltd v Owners Corp [2015] VSC 160).

That Act allows for building owners to bring claims against builders for, among other things, failing to carry out work in a proper and workmanlike manner, for using materials that were not suitable for the purpose which it was used, and for failing to complete work in accordance with the relevant building standards.

Owners and owners corporations may also have claims against the builder, developer, building surveyor and others in negligence, for failing to take reasonable care to ensure that the materials used on the building complied with the relevant building standards.

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