Building Warranties for Unit Complexes over Three Stories

As you may be aware there is no statutory builders warranty for structural defects for unit complexes over three stories high. This means that if there is any defective work done you can't force the builder to come back and fix it up and the building and services authority won't assist you in getting the work fixed up either.

Are there any alternatives?

There have been a number of cases run in New South Wales where unit owners have sued the developers and builders saying they owe a Common Law Duty of Care to rectify defects in common property caused by defective building work.

Unfortunately the New South Wales case of Owners Corporation Strata Plan-v-Brookfield 2012 held that the developer and builder did not owe a Duty of Care to the Body Corporate in relation to the alleged defects to the common property. In another case of Owners Corporation Strata Plan-v-Brookfield Multiplex 2012 the judge confirmed the earlier decision and stated that "the legislature has considered, and made clear provision for the extent to which a builder is liable to a subsequent owner, and a trial judge should not intervene".

It would therefore appear that a unit owner has no rights against the developer or builder unless there is something in the Contract of Sale.

Council's liabilities

In the New Zealand case of North Shore City Council, the Body Corporate 2010 record held that Council did owe Duty of Care to the owners of residential buildings. Where Council issues a Compliance Certificate incorrectly then they will be liable for any damage suffered by unit owners.

It is likely that the Queensland courts with follow the New Zealand decision although there hasn't been any Queensland cases to date. We suspect that it is going to be very difficult to prove that the Council made an error in issuing the Compliance Certificate where the building work was involved.

Not withstanding the above, it is strongly recommended that people buying into unit complexes do so with the expectation that they are not covered for structural defects. However, if the structural defects are serious there may be some avenue to recover the cost to rectify them from the Council.

If you want to know any further information please do not hesitate to contact Roland Taylor on 0417 605 185.