DEVELOPERS CUTTING CORNERS FOR PROFIT WOULD BE A CRIME ELSEWHERE

Emergency props were placed in parking spaces below the building in recent weeks before the evacuation. Picture: Damian Shaw

Emergency props were placed in parking spaces below the building in recent weeks before the evacuation. Picture: Damian ShawSource:News Corp Australia

Professorial Fellow, University of Melbourne LAW SCHOOL, Ian Bailey wrote … in his opinion there has been abandonment by state governments of the responsibility to impose upon strata unit developers an obligation to comply with building regulations. And of the failings of the Commonwealth …

Mr Bailey provides the steps necessary to be taken in a complex process!


Developers cutting corners for profit would be a crime elsewhere

By Ian Bailey

July 22, 2019

The Commonwealth and all state governments have known about the widespread construction of defective multi-storey residential buildings for many years.

That building ministers from all states are going to cooperate and coordinate reform is welcome, but a mere beginning to a complex process.

The full extent of the problems is seriously misunderstood, and the looming economic and social crisis has not been recognised.

Defects in a Sydney building.
Defects in a Sydney building.CREDIT:ROSS TAYLOR

First, the problem of flammable cladding affects buildings of all types, commercial, institutional, and industrial, as well as residential.

Undoubtedly it is serious, and demands immediate action. However a focus on cladding distracts attention from the even more critical failures which have occurred in the multi-storey strata apartment sector of the construction industry.

The fundamental issue is the extensive construction of multi-storey apartment buildings by some developers who, for the sake of profit, have included seriously inadequate fire safety and water-proofing, among other deficiencies.

No photo description available.

CAAN Photo: The walls of the basement garaging are permanently stained from water leaks (water falls) when not raining! Extensive cracking to the floor of the basement and walls! Lane Cove Electorate Sydney

The broader construction industry is capable of quality and compliant construction, even under the current regulatory controls.

*Multi-storey commercial buildings, shopping centres, hospitals and schools are generally not leaking, at risk of fire, or uninhabitable.

Those who wish to or, by law, are obliged to build correctly, are able to do so. Among these are reputable strata unit developers.

There have, however, been a disturbing number of apartment developers who have taken an approach to their legal obligations which in some countries would be regarded as a crime.

*The offending developers have been aided in their misconduct by the delusional process of private certification and, more importantly, by the abandonment by state governments of the responsibility to impose upon strata unit developers an obligation to comply with building regulations.

*The Commonwealth has played its part in its abject failure to address the facility with which the single purpose corporations, used by these developers, could be voluntarily wound up, often without payment of tax and Australian contractors.

*The Commonwealth also bears a significant responsibility for the ease with which dangerous flammable cladding was imported.

*The Commonwealth has the constitutional authority to legislate in relation to insurance and, as with the introduction of the Australian consumer law, the capacity to legislate to ensure consumer protection.

Mascot towers cracks

▲ Mascot Towers: Photos taken inside the building show that the cracks are not just limited to the structural support beam in the basement. The Urban Developer

Two separate elements need to be considered. The first is the problems faced by the present owners of the defective and unsaleable units and the second is what must be implemented to prevent a recurrence of the problems.

*The Commonwealth, in cooperation with all states, should establish a compensation “insurance” agency to address those affected by non-compliance and cladding issues.

The Commonwealth should also introduce legislation requiring all residential “developers” in the future to have a major defects policy taken out with the agency, with the objective that the insurance is ultimately addressed by commercial insurers.

The premium involved could reflect the degree to which the developers engage with the state regulatory authorities to ensure compliance of the construction work. The states also need to legislate to require compliance.

It is not going to be easy but what Australia now needs is leadership and the setting aside of federation-based argumentative shadow boxing.

Ian Bailey is a professorial fellow at the University of Melbourne Law School and was the co-director of studies in the construction law masters program from 2000 to 2014.

Opal Tower in Sydney Olympic Park was evacuated when cracks appeared on Christmas Eve. Picture: Jonathan Ng

Opal Tower in Sydney Olympic Park was evacuated when cracks appeared on Christmas Eve. Picture: Jonathan Ng

SOURCE: https://www.smh.com.au/national/developers-cutting-corners-for-profit-would-be-a-crime-elsewhere-20190721-p5297w.html

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