International Construction Law Review
REGULATORY REFORMS FOR RESIDENTIAL APARTMENT BUILDINGS DOWN UNDER – GETTING IT RIGHT FROM START TO FINISH
ANDREW CHEW (PARTNER)1
Corrs Chambers Westgarth, Sydney, Australia
BLAKE OSMOND (ASSOCIATE)
Corrs Chambers Westgarth, Sydney, Australia
ABSTRACT
New South Wales (NSW), Australia’s most populous state, has taken a multi-pronged approach to tackling various challenges in the delivery of residential apartment buildings. Many of these challenges arise from unreliable quality assurance from designers, builders and property developers, the use of flammable cladding, poor governance by developers and the need for better oversight by financiers. A suite of new legislation has been introduced by the NSW State Government, and passed by the NSW Parliament, which gives the Regulator better oversight and enhanced powers, imposes harsher sanctions on corporations and personal liability for senior management, and encourages financial institutions to implement more prudent risk governance measures. It is hoped the changes will improve the quality of buildings, facilitate greater confidence in the construction industry, and ultimately, provide better protection for the owners of those dwellings.
INTRODUCTION
In recent years in Australia, there have been a number of high-rise apartment building failures – ranging from flammable cladding fires (such as the Lacrosse incident in 2014)2 to major structural defects in buildings (such as the Opal3 and Mascot4 buildings in Sydney,
1 Andrew is a member of the Pillar 4 working group established by the NSW Building Commissioner to assist in the implementation of the NSW Government’s six Reform Pillars.
2 Melbourne’s Metropolitan Fire Bridge, Cladding, https://www.ourstorymfb.org.au/cladding (last accessed 26 August 2021).
3 On Christmas Eve in 2018, residents were forced to evacuate Opal Tower after cracks appeared inside the 38-storey, 392-apartment building. Some residents were unable to return for over a year; Clun, R, “‘It’s not ok’: Worst damage in Opal Tower revealed as residents pick up the pieces”, Sydney Morning Herald, 25 December 2019, https://www.smh.com.au/national/nsw/it-s-not-ok-residents-sleep-in-cars-on-christmas-eve-as-building-cracks-20181225-p50o6g.html (last accessed 26 August 2021).
4 In June 2019, residents were forced to evacuate Mascot Towers after cracks emerged and engineers became concerned that “downward movement” in the building indicated that the structure was sinking. The building contained 132 apartments and was 10 storeys. The building still can’t be occupied two years later, leading to calls for the Government to buy the apartment block and demolish the building; Goddard, D, “Sydney’s dirty strata secrets emerge through cracks in Mascot Towers”, Sydney Morning Herald, 18 June 2019, https://www.smh.com.au/national/nsw/sydney-s-dirty-strata-secrets-emerge-through-cracks-in-mascot-towers-20190617-p51yg7.html (last accessed 26 August 2021).
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