Building defects are one of the most stressful challenges facing owners’ corporations (OC’s) across Victoria. Whether it’s a leaking balcony, a cracking basement, or faulty waterproofing, building defects that go unnoticed or unaddressed for too long can lead to further defects and a costly bill to get everything fixed.
There is rarely one single person or group responsible for checking, addressing and taking responsibility for building defects: it depends on the defect, where it is, and how quickly you act.
Understanding Liability: What is Construction’s Role?
To understand liability, it’s important to understand who was involved in the construction. A residential apartment project typically involves a head contractor (builder), subcontractors, architects, engineers, and building surveyors. Each of these parties bears different responsibilities under Victorian legislation, so liability rarely falls on a single party.
If the builder is solvent, they’ll typically be liable for defects that constitute a breach of the statutory warranties implied into domestic building contracts under section 8 of the Domestic Building Contracts Act.
Those warranties protect subsequent purchasers of the building, not just the original contracting party. They also extend to the OC in respect of defects in common property.
Understanding Liability: Common Property vs Private Lots
Under section 4 of the Owners Corporation Act 2006, the OC is responsible for managing, administering, and repairing the common property and any fixtures, fittings, and services related to it. This means the OC, not the individual lot owner, is the party with legal standing to pursue claims over common property defects.
For defects located in or on a private lot, only the private lot owner has standing to sue for compensation.
Where things get complicated is the grey zone, and balconies are a classic example. These grey areas have given rise to differing conclusions by the Victorian Civil and Administrative Tribunal (VCAT), particularly regarding conventionally drawn subdivision plans. These nuances are why it’s vital to have experienced OC management on hand to help guide you through the process.
What To Do If You Discover a Building Defect
Step 1: Document it immediately
As soon as a defect is identified, start a paper trail. Photograph everything, note the date of discovery, and record the location and nature of the defect.
Step 2: Get a building consultant’s report
This report will identify the probable cause, the extent of the damage, and the recommended rectification, and it’s typically required before any formal dispute process can begin.
Step 3: Work out where the defect is
This determines who has the legal standing to act. The OC handles common property defects; individual lot owners handle defects within their own lot. If you’re unsure, your OC Manager can help work through this.
Step 4: Notify the builder in writing
If the builder is still operating, formally notify them of the defect in writing and invite them to rectify it. If the builder refuses, an application will need to be made to the Building and Plumbing Commission (BPC), which can appoint an assessor to conciliate the dispute.
Step 5: Escalate if needed
If the defect remains unresolved, you can lodge a dispute with the BPC or proceed to VCAT. For common property defects, the OC will typically lead the action, with affected lot owners joining as co-applicants.
Get Expert Support With Building Defects
At Above OCM, we work with experienced professionals and help OCs stay on top of their obligations, from maintenance requests to guiding the committee on when and how to escalate building defect concerns.
If your building has unresolved defect issues, or your committee isn’t sure where to start, get in touch with our team.
