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Residential Focus

25 August 2021

#Property, Planning & Development

Published by:

Stephanie Tan, Simona Njaim

Residential Focus

Code of practice under the Design and Building Practitioners Regulation 2021

In this edition, we review the Code of Practice (Code) introduced under the Design and Building Practitioners Regulation 2021 (Regulation), its purpose and the practical implications on prescribed practitioners since 1 July 2021.

Rebuilding confidence

The Design and Building Practitioners Act (Act) and Regulation have introduced a myriad of regulatory changes. These changes all have a common intent – to rebuild confidence in the NSW construction industry. Standards have been lifted at the start of the building process, formal qualifications are required and continuing education obligations imposed. At the heart of these changes, the practitioner’s values, principles and capabilities are being recalibrated.

In many professions, a code of practice establishes a guideline of principles and standards of what is acceptable conduct or behaviour for that particular group or profession. Non-compliance with these rules may result in a reprimand, disciplinary action and, if serious enough, deregistration.

The benefits of a code of practice are twofold. Firstly, it defines the profession’s values by setting standards for that profession, which builds competency. Secondly, it creates transparency for the public for what can be expected, which builds trust.

Code of practice

By virtue of Section 50(2) of the Act, clause 36(5) of the Regulation compels compliance to a code of practice as a condition of registration as a practitioner. In other words, any practitioner making a design compliance declaration for a regulated design or building compliance declaration for building work must comply with the Code, otherwise, they cannot be registered.

Schedule 4 of the Regulation sets out the Code for prescribed practitioners (Part 2, Division 1 – registered design practitioner, a registered principal design practitioner or a registered building practitioner) and professional engineers (Part 2, Division 2).

What to expect – the prescribed practitioner

There are various obligations for prescribed practitioners set out in the Code of Practice.

Duty to act in a professional manner

Prescribed practitioners must:

  • act with honesty, integrity and in a professional manner
  • act towards the person for whom the practitioner is doing the relevant work, and carry out the relevant work, in good faith
  • not unreasonably discriminate against a person or organisation
  • exercise reasonable care and attention.

Duty to act within level of competence and expertise

Prescribed practitioners must not carry out relevant work that is not authorised by their registration or is beyond their competence or expertise.

Duty to maintain satisfactory level of competence

Prescribed practitioners must ensure that they remain informed of developments in building design, construction and industry practice in relation to building design and construction, to the extent that the developments are relevant to their work and the law applicable to the carrying out of their work.

Duty to avoid conflicts of interest

Prescribed practitioners must:

  • take all reasonable steps to manage and disclose potential or actual conflicts of interest to a client of the practitioner, and avoid actual conflicts of interest if practicable
  • not improperly use their status, position, powers or duties to obtain, either directly or indirectly, a personal benefit or benefit for a relative or close associate
  • not solicit or accept an improper benefit in relation to the carrying out of their work
  • take all reasonable steps to ensure that a relative or close associate of theirs does not solicit or accept an improper benefit, whether on their behalf or on behalf of another person.

Duty to maintain confidentiality

Prescribed practitioners must:

  • not disclose confidential information acquired in the course of being a prescribed practitioner except with the consent of the person to whom the duty of confidentiality is owed, or where the disclosure is otherwise authorised or required by law
  • not use confidential information acquired in the course of being a prescribed practitioner to secure an improper benefit for themselves or a relative or close associate
  • take all reasonable steps to ensure that confidential information acquired in the course of being a prescribed practitioner, including in relation to a client, is held securely.

What to expect – professional engineers

Division 2 of Schedule 4 sets out the Code of Practice for professional engineers, which describe very similar obligations as prescribed practitioners. However, professional engineers have these additional obligations:

Duty to act in a professional manner

The professional engineer must:

  • not knowingly act or enter into conduct that could bring, or tend to bring, the profession of engineers into disrepute
  • take all reasonable steps to protect the health and safety of the community when carrying out professional engineering work, including by identifying hazards, assessing risks, implementing appropriate strategies to manage risk.

Duty to act in the best interests of the client

Registered professional engineers must take all reasonable steps to act in the best interests of a client. However, they are not required to act in the best interests of a client if doing so would be inconsistent with the requirements placed on the professional engineer by or under the Act or another Act or law, or contrary to the public interest.

Duty to deal and communicate with clients in professional manner

Registered professional engineers must take all reasonable steps:

  • to inform a client of the professional engineer of the social, environmental or economic impacts of the carrying out of professional engineering work that may affect the client
  • to inform the client of concerns or decisions that the client is required to make in relation to the carrying out of professional engineering work
  • to ensure that information is provided to the client in a timely manner, and in a clear and accurate form, including in relation to the following:
  • the carrying out of professional engineering work
  • fees or costs in connection with professional engineering work
  • risks in connection with professional engineering work.

Duty to provide information to clients

Registered professional engineers carrying out, or directly supervising, professional engineering work must take all reasonable steps to provide the following information to a client of the professional engineer:

  • the professional engineer’s name, telephone number and address of the principal place of business
  • if a person is engaged by the registered professional engineer to provide specialist advice in relation to professional engineering work (an engaged person):
  • the name and telephone number of the engaged person
  • the role of the engaged person
  • the address of the engaged person’s principal place of business
  • if the engaged person is registered under the Act, the registration number of the engaged person.

Non-compliance with the Code

Complying with the Code must be taken seriously. As it is a condition of registration, non-compliance can attract up to 600 penalty units ($66,000) for a body corporate or 300 penalty units ($33,000) for an individual according to Section 56 of the Act. Additionally, under Section 66(1) of the Act, the Secretary may take disciplinary action against a registered practitioner which may impose conditions, suspend, cancel or even disqualify a practitioner from registration.

Road ahead

The landscape for design and building practitioners is changing rapidly. The underlying purpose of the Code should lift the standards of its practitioners and build confidence in the construction industry. For many prescribed practitioners in particular, the idea of a Code is new territory. Therefore, we recommend practitioners review the Code carefully and implement practices and ongoing education to reflect the standards set out in the Code.

Authors: Stephanie Tan & Simona Njaim

In the media

Building demand drives 1.4 per cent quarterly increase in Australia’s housing construction costs
CoreLogic’s national measure of residential construction costs show an increase of 1.4 per cent in the three months to June 2021, outpacing the consumer price index of 0.8 per cent for the same period. A shortage of materials such as timber, PVC piping and fittings have contributed to the rise in costs with no sign of easing in the short-term (18 August 2021).  More...

Construction industry calls for essential worker classification as builders, suppliers 'going to the wall'
Members of the construction industry have gathered on either side of the Queensland-NSW border, some risking a fine, to call to be classified as essential workers allowing them to cross (18 August 2021).  More...

Slow vaccination hampers construction recovery in Australia and New Zealand
Australia and New Zealand’s construction outlooks improved over the second quarter of this year but slow vaccination programmes, rising costs from supply chain pressures and labour shortages are creating considerable challenges, says consultant Turner and Townsend in its latest market report (16 August 2021).  More...

Lockdowns weigh on new home sales in July
New home sales fell by 20.5 per cent in July, with declines experienced in almost all major states, according to the HIA new home sales report – a monthly survey of the largest volume home builders in the five largest states (11 August 2021).  More...

DKO-designed social and affordable housing in Redfern is ready
An 18-storey residential development in Redfern, NSW offering 160 social and affordable housing units is now ready for occupation. Located on Gibbon Street in the inner city Sydney suburb of Redfern, the residential tower is one of the largest social and affordable housing projects in all of NSW (19 August 2021).  More...

'Threat of collapse': Builders of Opal Tower caught up in row over separate building
Corroding balustrades which pose a "threat of collapse" are among the many defects found in an apartment complex in Sydney's south as the building commissioner issues the Opal Tower builders with an order to fix (13 August 2021).  More...

Published – articles, papers, reports

Australian Bureau of Statistics
10 August 2021 – building approvals data for small geographic areas.

Practice and courts

ABCB: Consultation open: Continuing professional development on the National Construction Code
Recommendation three of the Building Confidence Report is that each jurisdiction requires all practitioners to undertake compulsory continuing professional development on the National Construction Code. Feedback on the draft model guidance is now sought via a discussion paper. Responses to questions in the discussion paper are invited until 5 September 2021. Click here for more information.

Adoption of NCC 2022 to be delayed
The delayed adoption will also see adjustments to key dates in the amendment cycle process for NCC 2022 to allow stakeholders time to participate. These adjusted dates include:
May – July 2021: NCC 2022 public comment draft released for public consultation.
May 2022: NCC 2022 preview published at ncc.abcb.gov.au.
If you have any questions regarding the delayed adoption of NCC 2022, please submit an online enquiry.

Guide for design practitioners and engineers
Consult Australia, Engineers Australia and the Australian Institute of Architects have joined forces to develop the guide for design practitioners and engineers to help their members tackle the recent NSW building confidence reforms. There are multiple new obligations on design practitioners, engineers and building practitioners throughout the life of a building under the NSW Design and Building Practitioners Act 2020 and the Design and Building Practitioners Regulation 2021.

Have your say on changes to how building design and construction is regulated in NSW
The development of supporting regulations is the next step on delivering on this piece of the government’s building reform agenda, with the scheme commencing on 1 July 2021. In response to your feedback, we've drafted a report that explains the changes that were made to the draft regulation. Click here for more information.

Conflicts of interest – savings and transitional arrangements
Clause 71 of the regulation introduces savings provisions for certain conflict of interest situations where the certifier was appointed before 1 July 2020 and the work will be completed before 1 July 2022. The provisions relate to council-certified developments and to developments where the certifier gave advice on how to comply with the BCA deemed to satisfy provisions. For all the changes, access the amendment regulation here.

New mandatory standards for building rectification
The standard will be reviewed and updated prior to the 1 July 2021 commencement of the government’s game changing building reform agenda underpinned by the Design and Building Practitioners Act 2020. The first practice standard will initially apply to certifiers working on residential apartment buildings, where the majority of problems and complaints have been received. The practice standard for registered certifiers is available on the Fair Trading NSW website.

Cases

Lawrence v Sammut [2021] FCCA 1929
BANKRUPTCY – application to set aside bankruptcy notice on ground that applicant has counter-claim, set-off or cross demand equal to or exceeding the amount of the judgment debt – bankruptcy notice based on a judgment entered on the registration of a costs certificate recording the assessment of costs debtor was ordered to pay to the creditors in proceedings in the Supreme Court of New South Wales in which debtor unsuccessfully claimed he had an interest in land – debtor claims he has counter-claim, set-off or cross demand based on money he spent and work performed in relation to the property – whether in determining whether debtor has counter-claim, set-off or cross demand the Court is restricted to considering the affidavit filed when the debtor filed application to set aside bankruptcy notice – Court not so restricted – whether the proceeding in relation to which the debtor could not have set up counter-claim, set-off or cross demand is the proceeding in which the order for costs was made or instead in the proceeding in which the certificate for costs was registered – the latter is the relevant proceeding which means that the counter-claim, set-off or cross demand the debtor claims he has could not have been set up in that proceeding – whether there is sufficient substance to the counter-claim, set-off or cross demand asserted to make it one which the debtor should, in justice, be permitted to have heard and determined in the usual way, rather than be forced to comply with the bankruptcy notice by payment or to commit an act of bankruptcy – there is sufficient substance in relation to some amounts but the amounts do not in total exceed the amount of the judgment debt – application adjourned to a date for the purpose of making an order dismissing the application and an order as to costs.

Lama v Roselands Services Pty Ltd (No. 2) [2021] NSWCATCD 53
COSTS – calderbank offer.

Patel v Caesar Homes Pty Ltd [2021] NSWCATCD 47
CIVIL PROCEDURE – jurisdiction – renewal of proceedings in the Consumer and Commercial Division of NCAT – whether condition in clause 8 of Scheme 4 of the Civil and Administrative Tribunal Act 2013 (NSW) has been satisfied.

Bourke v Wincrest Group Pty Ltd [2021] NSWCATCD 44
BUILDING AND CONSTRUCTION – Home Building Act 1989 (NSW) – statutory warranties – renewal proceedings where work order not complied with – ‘major defect’ – ‘major element’.

Blackhall v Fine Cut Building Pty Ltd [2021] NSWCATCD 43
BUILDING AND CONSTRUCTION – Home Building Act 1989 (NSW) – sections 18B, 18F, 48MA – statutory warranty – defective work – statutory defence – whether failure to comply with specified purpose – mitigation of damage – work order or money order.

Manfredini & McCrae v NSW Architects Registration Board [2021] NSWCATOD 116
OCCUPATIONS – architects – complaint – disciplinary determination – reprimand – fine – order for refund – application for review – whether conduct breach of code of conduct – whether unsatisfactory professional conduct – appropriate disciplinary orders.

Smith v Slater [2021] NSWCATCD 38
BUILDING AND CONSTRUCTION – Home Building Act 1989 (NSW) – unlicensed contractor – defective and incomplete work –​​​​​​​ damages.

Garofali v Moshkovich [2021] NSWCATAP 242
BUILDING AND CONSTRUCTION – residential building work – written contract – whether payments made outside terms of written contract – whether contract had been varied – no error established.

The Owners – Strata Plan No 68255 v Downs; Downs v The Owners – Strata Plan No 68255 [2021] NSWCATCD 34
LAND LAW – strata title – common property – identification of common property – delineation of boundaries between lot and common property – interpretation of strata plan – whether order should be made restraining a lot owner from exclusively occupying common property.
LAND LAW – strata title – owners corporation – meetings of owners corporation – whether the Civil and Administrative Tribunal has jurisdiction to order an owners corporation to convene a general meeting.

Gaskell and Bourke v Northshore Homes Pty Ltd and Nazha [2021] NSWCATCD 33
BUILDING and CONSTRUCTION – misleading and deceptive conduct – director’s liability for statements made on behalf of company – scope of section 74(3) of the Fair Trading Act 1987(NSW) – Jones v Dunkel inferences.

Legislation

NSW

Regulations and other miscellaneous instruments
Local Government (Manufactured Home Estates, Caravan Parks, Camping Grounds and Moveable Dwellings) Regulation 2021 (2021–461) – published LW 20 August 2021.

Disclaimer
The information in this publication is of a general nature and is not intended to address the circumstances of any particular individual or entity. Although we endeavour to provide accurate and timely information, we do not guarantee that the information in this article is accurate at the date it is received or that it will continue to be accurate in the future.

Published by:

Stephanie Tan, Simona Njaim

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