Article contributed by James Collier, Partner – Moray and Agnew Lawyers
- On 15 October 2019, the Building Amendment (Cladding Rectification) Bill 2019 (‘the Bill’) was introduced into the Victorian Legislative Assembly with three primary purposes.
- Firstly, following on from its involvement in the 2017 Victorian State-wide Cladding Audit, the Bill proposes to confer additional advisory and monitoring functions to the Victorian Building Authority in relation to the rectification of non-compliant or non-conforming external wall cladding products on Victorian buildings.
- Secondly, the Bill proposes to establish an account for Cladding Safety Victoria to provide financial assistance to building owners in relation to cladding rectification work by introducing an additional levy on certain building permits up to 82% of the cost of the building work. However, the Bill does not shed any light on the relevant policies, procedures, or guidelines to satisfy the release of rectification funds by Cladding Safety Victoria.
- Thirdly, the Bill proposes to subrogate to the Crown all the rights and remedies of any building owner whom receives financial assistance from Cladding Safety Victoria and to establish safeguards to prevent building owners from recovering twice for the same cladding rectification work – once from the builder and once from Cladding Safety Victoria.
- The Bill imposes a wide ranging power exercisable against any individual, entity, or the entity’s officers at the time in relation to the installation or use of cladding which the Crown has provided financial assistance to rectify. Practically, this means the Victorian Government will have the right to bring recovery claims (whether in its own name or the building owner’s name) against any person involved. Whilst the target for similar recovery actions is often the builder, other entities such as the builder’s subcontractors, consultants, suppliers, or manufacturers may also find themselves a party to any proceedings, such as in the case of the 2014 Lacrosse Tower fires.
- As at 31 October 2019, the Bill was sent to the Legislative Council for consideration.
- While the Bill gives cause for optimism to those owners of apartments in buildings with unsafe cladding, it raises more questions than it answers about the eligibility criteria for obtaining the financial assistance to rectify defective cladding. We shall keep you updated as to the progress of the Bill through the Victorian Parliament
The content in this paper is intended only to provide a general overview. It is not intended to be comprehensive nor does it constitute investment nor legal advice. You should seek professional advice before acting or relying on any of the content.