12 June 2024

Building defects: Broken system in need of repair. Time to bring back public certifiers

| Ian Bushnell
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More and more people are buying townhouses and apartments. They deserve better protection. Photo: Tobias Wilden.

After reporting on property development and the thorny issue of defects for seven years, I am now part of the ongoing story about how to give buyers of new homes more security about their purchases.

Eighteen months into our residency at a new townhouse and apartment complex, the failure of the builder has led to owners having to make an insurance claim to cover the cost of any defects still not rectified.

We thought the builder, an experienced and reputable company, had dealt with all defects we could identify but, as ever, if only it were that simple.

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A preliminary assessment by a structural engineer has found a host of defects in a sample of units and townhouses and common areas that could amount to millions of dollars worth of rectifications across the development.

Some are structural, which means they have to be fixed to be compliant, as well as the ubiquitous waterproofing issues.

Problems may not be apparent now, but the general experience is that they will emerge in the next few years if not dealt with.

It’s important to note, we’re happy with our new home and the complex generally. Overall, the builder did a good job and was very responsive afterwards.

Whether the pandemic interruptions or trades and material shortages contributed to the defects, we don’t know, but the key question is if the building was certified as ready for occupancy, how is it that just 18 months later, owners are coming to terms with a whole bunch of things they were unaware of?

It is such a familiar story, so why should I be surprised?

It’s systemic, the structural engineer and lawyer preparing our claim say.

And the finger is pointed at the private certifiers who are either too close to builders and developers or not up to speed when it comes to identifying major defects.

Despite years of campaigning by the likes of the Owners Corporation Network, the tightening of regulations, and the push to license developers, the system remains broken, leaving owners and strata managers having to pick up the pieces.

Self-regulation has been an abject failure, and using private certifiers is obviously not working.

They should be brought back into the public realm, at arm’s length from the building industry, and brought up to a standard, with oversight, that owners can rely on.

Those certifiers will no doubt cry foul, saying they are being smeared. But they are the gatekeepers. How can they defend work that so demonstrably has led to the general opinion that defects, and not just the run-of-the-mill kind that can be picked up easily, but those that can affect the safety and viability of a building and home are to be expected?

The bright side is that there is now a good chance that most of the defects now identified in our complex will be fixed before they become a problem, and owners’ costs will be limited to inspection reports, legal fees and excess.

But it is a scary time for owners, some, no doubt, with large mortgages, and there is no guarantee that claims will be accepted in full or that the owners corporation won’t have to strike levies to cover other costs.

It’s an issue that the ACT Government estimates costs the community $50 million a year in the strata industry, but the OCN says the cost is much more.

“Such remediation costs add more to the overall cost of home ownership than building to a quality standard from the outset – especially in the strata sector where defects can be multi-million-dollar problems and affect many owners and renters,” it says in its submission to the Developer Licensing Bill inquiry.

It also believes the period where the onus of proof falls on the developer/builder to demonstrate that a problem was not due to construction defects should be extended from two to 10 years.

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The OCN also suggests that builders/developers should be forced to use the same architects and engineers throughout the entire life of a project.

But the buck stops with the certifiers, and a more rigorous regime should mean defects are minimised (builders are not perfect) and better managed.

The issue can’t be ignored, as more and more home buyers are looking for more affordable medium- and high-density housing.

They should be able to move into their new home safe in the knowledge that it is not going to cost them a bucket load more than what they have already outlaid, not to mention the uncertainty and worry.

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I agree with your view that “They should be brought back into the public realm, at arm’s length from the building industry, and brought up to a standard, with oversight, that owners can rely on.” Some years ago, an extension to a previous house we owned was due for sign off at the end of the project. It was then that we discovered there was no paperwork for termite proofing. It turned out that the builder hadn’t done it and the certifier that we were paying completely missed it. Thankfully there was an easy work around that was done by the builder, but how it was missed is a mystery to me. Similarly, some of the electrical work didn’t seem to be up to scratch. Building Control examined the site and failed it. I later discovered that the electrician certified his own work under the self certification system – not good enough. I don’t know what it’s like these days but as far as I’m concerned self certification is akin to putting the fox in charge of the hen house.

Incidental Tourist8:12 pm 02 Jun 24

Most houses built 30+ years ago stand well tested by time. Today solid homes were replaced with colorbond and MDF boxes standing on bureaucratic layers, red tapes and regulations. No wander these card-boxes don’t last. What’s the knee jerk fix? – of course add more bureaucracy and red tape. Here is the common sense verdict – if you want quality homes, then build them from concrete and bricks as proven by past 2000 years. Layers of bureaucracy and regulations are irrelevant.

HiddenDragon7:54 pm 02 Jun 24

This is a perfect example of deregulation/outsourcing which should never have happened, and the issues outlined in this article have been known by a lot of people for a long time.

Going back quite a few years, I seem to recall media reports of a then junior minister named Andrew Barr who was having little success in dealing with defects in his own apartment building – even though he was, at the time, the minister directly responsible for the regulation of the ACT building industry.

Something along these lines might be worth pursuing, desirably with maximum harmonisation of rules and standards to keep things as straightforward as possible for builders working on both sides of the border –


as a retired tradie having worked under both privet and public inspections. Public is safer, less court action and cheaper in the long run

one high rise in Phillip just failed its total electrical

Edward Steward8:03 am 01 Jun 24

Building certifiers are not the problem. Engineers (structural, mechanical, hydraulic, electrical, etc) are the experts and are required to sign off on their areas of expertise. The building Certifier can’t be expected to specialise in every facet of the construction and as such rely on the design and installation certificates from the experts. The problem is the builders and engineers signing off on substandard work.

Make builders and certifiers personally liable for defects. Once they know they cant just declare bankruptcy and bail out, they will become more interested in delivering to spec

It has been proven many times over the years that ” private certifiers” and “self regulation ” has failed everyone except the developer.
It is human nature to try short cut the process or do things the easy way.
There is definitely a requirement for a governing body to inspect buildings at ALL stages.
The building industry is too full of “cowboy fly by night builders” that require reigning in to stop the constant phoenix industry that is currently called the building industry.

Stephen Wall6:08 pm 31 May 24

Things have been going down hill since they took away government employed inspectors in all aspects of building, especially when a builder can employ an inspector who is not going to say the work is shoddy, they want to keep working.

When are buyers going to understand that there is a Huuuuge difference between a “defect” and a non-compliance??? Private Certifiers are NOT paid to regulate defects if they are not non-compliances with the Building Codes!

devils_advocate1:22 pm 31 May 24

While I actually support the idea of government-certifiers – much deeper pockets to sue for malpractice – I do note that having to get the government certifier out on site is going to add months if not years to build times

Satan Herself11:56 am 31 May 24

Dear Fox,

Please investigate your actions at the hen house on Saturday night.


Some dude with a portfolio that covers housing.

Dear Some dude,

I’ve investigated my actions at the hen house on Saturday night and I can assure you that they were all complying with code.



We need more inspectors like this guy.

Andrew McLaughlin10:48 am 31 May 24

Perhaps one solution could be for private certifiers to be insured. That way, claims could be made against their insurance for things they ‘miss’ during the certification process.

Why should certifiers be responsible for builders shoddy workmanship or cheaping out on materials? Make the builders personally liable. Prevent them dodging responsibility for their work.

A simple change to the law preventing builders from denying liability for defects would probably fix the issue. Make the company director personally liable.

@Ken M
“Make the company director personally liable.”
While I agree with the sentiment of your suggestion, Ken M, it would require a change to the federal Corporations Act – wherein their is limited liability protection known as the ‘corporate veil’, which protects directors’ personal assets from business-related risks and liabilities.

A provision already exists for ‘piercing the corporate veil’ – circumstances like fraud, insolvency trading, illegal activities, and statutory violations are common grounds. However, proving this within the context of “denying liability for defects” is just another way to throw money at lawyers.

Money will be thrown at lawyers regardless.

What I see here is shifting the blame for shoddy workmanship onto certifiers. The certifiers didn’t build it. They said it was within specs when they inspected it. Making builders unable to dodge responsibility for defects identified as poor workmanship would do a lot to solve the issue. And you are probably aware that the worst offenders aren’t real corporations. It’s usually one guy or a couple of people putting up cash to hire subcontractors. They use the Corporations Act to get away with doing it repeatefly.

A real scandal in Canberra is that the ACT Government allows developers selling off-the-plan to have a clause in the contracts that during the final building inspection only the buyer is allowed into the apartment.

You cannot bring in an experienced builder or tradesman to check out the build quality despite this being best practise.
Quiet a scandalous situation that works against the buyer.

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