DevelopmentsIndustryManagement

Contractors judged liable in shock apartment fire ruling

Builder Lu Simon has been ordered to pay $5.7 million in damages to apartment owners over Melbourne’s Lacrosse tower fire – but his contractors must fund 97 percent of the sum.

A Victorian tribunal this week ruled the builder must pay the 211 applicants in the case, but Justice Edward Woodward found Simon’s consultants – architect Elenberg Fraser, building surveyor Gardner Group and fire engineer Thomas Nicolas – were liable for the bulk of the costs.

“Each of Gardner Group, Elenberg Fraser and Thomas Nicolas will be ordered to reimburse Lu Simon,” Justice Woodward said, with damages payable proportioned to Gardner Group at 33 percent, Elenberg Fraser 25 percent and Thomas Nicolas 39 percent.

The 2014 Lacrosse tower fire, which was ignited by a cigarette left on a balcony, resulted in millions of dollars’ damage to the 21-storey Docklands building as flames fuelled by flammable external cladding spread rapidly.

It predated London’s devastating Grenfell Tower disaster, which claimed the lives of 72 people and  sparked a worldwide review of external cladding on apartment buildings and hotels across every major city. 

Nobody died in the Lacrosse inferno, but the owners of apartments affected launched a lawsuit against Simon which resulted in the Victorian ruling.

Further sums claimed totalling at least $6.8 million are yet to be resolved, with Justice Woodward to announce final orders and costs next week.

The decision has reportedly sent shockwaves throughout the architecture community.

Geoff Hanmer, adjunct lecturer in architecture at UNSW, said in The Conversation: “The decision reminds architects and other consultants that abiding by common practice is no defence if that practice is inadequate.

“Even though an architect may work for the builder and be employed on a limited commission during construction, they still bear primary responsibility for the safety of the building as the ‘lead consultant’.

“According to the decision, architects and consultants are required to exercise high standards of professional judgement and skill even if their commissioning arrangements and fees militate this.”

While the decision gives apartment owners cause for hope in their search for compensation over cladding issues, Judge Woodward warned the decision applies to the specific circumstances of Lacrosse only.

Which means the owners of other buildings including Melbourne’s Neo200, which was evacuated on February 4 after a similar fire, might not see the same kind of result.

The legal costs in the Lacrosse case were also considerable; Hanmer estimating them at around $2 million, or more than 15 percent  of the damages sought.

He said: “Around the country, based on state audits, I estimate around 1,000 buildings have combustible aluminium composite panels on their facades. If they all generate a court case half as complex as Lacrosse, the legal bills alone could total over A$1 billion.”

Hanmer also argues government bears some responsibility for deregulation of the building industry, allowing the relaxation of building codes to make the use of aluminium composite panels permissible, despite evidence as early as 2000 showing the panels to be combustible and unsuitable for tall buildings.

Kate Jackson

Kate Jackson is the editor of Accomnews. You can reach her at any time with questions or submissions: [email protected]

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