High court decision leaves BC victims of dodgy builders
The peak industry body representing strata title properties is disappointed by a recent decision by the High Court that leaves bodies corporate with no common law recourse against builders who have failed to adequately construct or repair buildings.
Two cases have come to light recently of bodies corporate fighting legal battles against developers over what they claim to be faulty buildings, with repair costs estimated at upwards of $2 million.
The New South Wales Court of Appeal held last year that a builder owed an owners corporation a duty to exercise reasonable care in the construction of the building to avoid causing the owners corporation to suffer loss resulting from latent defects in the common property, provided the defects met certain criteria.
On recent appeal, the High Court held that a builder did not owe such a duty of care.
The peak industry body for strata title management in Queensland, Strata Community Australia SCA (Qld) is deeply disappointed by this outcome and for bodies corporate that are left with no common law recourse, and only limited statutory rights against builders who have failed to adequately construct buildings at their schemes.
“I really feel for strata title owners in this situation. In addition to the actual repair bills, the legal costs are obviously astronomical but then there are also the high levels of stress and potential losses in property values,” said SCA (Qld) President, Simon Barnard. “To avoid potential legal action, bodies corporate should ensure that they make a complaint to the Queensland Building and Construction Commission about any building defects, within the correct time period. This is generally within six years and three months after the completion of works, and complaints should be lodged within three months of detecting the defect.” Mr Barnard said.
“In particular, bodies corporate should obtain a comprehensive building report, identifying all defects, by a licensed, third party contractor prior to the expiration of the time limits.”
“The QBCC may then issue a direction to rectify to the building contractor and, if that is not complied with, the body corporate may have rights under the statutory insurance scheme admistered by the QBCC”
Recent reports have found billionaire developer Harry Triguboff in the centre of a legal battle with a Southport body corporate who claim their property is in need of $2 million worth of repairs.
Residents of Silverstone Apartments on the border of Queensland and NSW are also undertaking legal proceedings against developer Villa World for hundreds of alleged defects including extensive corrosion and rust, mould, leaks, cracking tiles, flaking paint and rotting timber.
