Re: Defects Rectifications

Hi Leonie

There are broadly three avenues available to an owners corporation in relation to building defects in common property:

1. HOW insurance claim – if your building is four storeys plus car parking and building work commenced after 1 January 2004, then you will not have this insurance available to you. If the work commenced before this date, then there may be HOW insurance available;

2. suing the builder and developer for breaches of statutory warranties (if there have been breaches of those warranties set out in s.18E of the Home Building Act); 

3. suing the builder and/or design consultant in negligence (depending on whether the building defect is caused by workmanship or design); or

4. depending upon statements made by the builder/developer which have been relied upon by the owners corporation to it's detriment, there may be an action for misleading and deceptive conduct.

Individual lot owners (in relation to defective lot property) may:

1. take action against the developer for breach of the sale contract (but this very much depends upon the terms of the sale contract) or for misleading and deceptive conduct (depending upon pre-contractual representations made by the developer or it's agents and the reliance of the individual owner on those representations); or

2. take action against the owners corporation for loss and damage suffered by virtue of a failure to maintain and repair common property (s.62 of the Strata Schemes Management Act).

In order to provide more detail in relation to these potential causes of action, I will need further instructions in relation to the elements which make up each cause of action.

Let me know if you have any questions.

Regards

Chris Kerin

TEYS Lawyers

(02) 9562 6500