Managing Building Defects

1 July 2021

Resident managers in new or near new complexes will be aware of the difficulties that can arise when dealing with building defects – particularly when they are extensive and you have an uncooperative developer/builder. A recent Deakin University report revealed that a significant number of apartment buildings have some form of structural defect.

In an attempt to address this increasing issue, new body corporate regulations – introduced in Queensland on 1 March 2021 – now place greater obligations on builders, developers and bodies corporate to make sure building defects are identified and rectified in a timely manner.

To identify exactly what amounts to a building defect, there are a number of commonly used definitions, but a building defect is generally accepted to be “work that is faulty or below a reasonable standard of quality”.

Body corporate’s legal position

A body corporate needs to consider various competing factors in managing building defects, including:

  • irrespective of the cause of the building defect, or a right of recovery against a third party, the body corporate must maintain common property in good condition;
  • the body corporate stands in the shoes of the developer with respect to any contractual action taken against the builder;
  • the developer’s obligations are limited to handing over certain relevant documents to the body corporate;
  • the body corporate’s best course of action will usually be a combination of:
    • making demands and negotiating with the
    •  making a complaint to the QBCC; or
    • taking action against the builder pursuant to the building contract; and
  • there are strict deadlines that need to be observed in taking any action for building defects.

Recent regulation changes

The new regulation modules made some key amendments to assist bodies corporate in managing building defects including:

  • An expansion of the developer’s obligations to hand over certain relevant documents to the body corporate, at the first annual general meeting.
  • An obligation on the body corporate to consider (not approve) a motion, at the second annual general meeting, to engage an expert to inspect the scheme and report on any identified building defects.

These changes will have the effect of better protecting bodies corporate on the basis that they ought earlier be in a position where they are armed with all the information necessary to take action to protect themselves from the costs and frustration of building defects.

Mahoneys building defect guide

Our building defect guide has been prepared to provide important detail on the legal position of a body corporate in relation to building defects. In addition to setting out clearly the role of the resident manager / caretaker the guide also covers:

  • what is a building defect;
  • the body corporate’s rights
  • the body corporate’s obligations;
  • where the developer fits in;
  • taking action against the builder;
  • the role of the QBCC;
  • the role of the body corporate manager; and
  • time-frames for taking action.

If you would like more information on building defects or a copy of our guide, please contact us.