Do your construction and consultancy contracts address the Design and Building Practitioners Act?
In mid 2017, the Building Ministers’ Forum, which oversees policy and regulatory issues in the building and construction industry, requested an expert assessment of the effectiveness of compliance and enforcement systems for the industry.
The Forum appointed Professor Peter Shergold AC and Bronwyn Weir to co-lead the assessment, and in February 2018 their report was delivered.
Its recommendations included:
a national approach to the registration and training of building practitioners
a statutory requirement for design practitioners to prepare documentation that demonstrates that proposed buildings comply with the National Construction Code.
In response, the NSW Government in February 2019 committed to major reforms to restore consumer confidence in the industry. They included:
the appointment of an expert Building Commissioner
an overhaul of compliance reporting
a requirement for all building practitioners with reporting obligations to be registered.
On 1 July 2021, the Design and Building Practitioners Regulation 2021 took effect.
The Regulation confirms that the Act applies to building work for the construction, making of alterations or additions, or the repair, renovation or protective treatment of class 2 buildings.
Of relevance to councils is that the word “building” includes part of a building.
This means a council development comprising one or more public facilities, a carpark or council offices in addition to residential apartments (often undertaken as a public private partnership) will be subject to the Act and Regulation.
The registration requirements aim to ensure that practitioners involved in the building and construction process are competent, qualified and suitably insured.
The Act and the Regulation require registered building and design practitioners to supply design compliance, principal compliance and building compliance declarations. These require a registered practitioner to declare that the work (whether design or building work) complies with the Act as well as the Building Code of Australia and the Regulation.
Under the Regulation, practitioners are also required to lodge documents at different stages of construction through the NSW Planning Portal. They include construction issued regulated designs for the building work, design compliance declarations, and a contractor document. The latter should include a list of:
the builder’s subcontractors
others who have undertaken building work
work done by subcontractors.
While these obligations are imposed on contractors and consultants (unless council is providing designs internally), it is in council’s interest to ensure they are properly carried out.
It is also council’s responsibility to the public to ensure its developments deliver quality buildings that are safe and comply with all legislative requirements.
That means that the design consultant and construction contracts employed by council respond to and implement the regime mandated by the Act and Regulation.
To this end, the NSW Building Commissioner offers two sample “contracts” – a construct only
building contract and a design consultancy agreement – which are actually model clauses designed to interface with the Act and Regulation.
The construction clauses, which are based on AS4000, should be used in construction contracts for construct only building work. Because the Regulation had not been published when the model clauses were created, the clauses will require some modification.
The design consultancy model clauses are based on AS4122 – 2010. They are not intended to be used for the appointment of a principal design practitioner, so such appointments will require different clauses.
The model clauses are provided as information only and not as legal advice, and they do not address contract matters other than the Act. Accordingly, councils should obtain legal advice about including the model clauses in their construction contracts.
Alternatively, councils may prefer to include bespoke clauses to ensure contractors and consultants comply with the Act and Regulation.
Either way, it is imperative that councils protect themselves and their communities by addressing this important legislation in their contracts.
Construct NSW research report
Bartier Perry were delighted to be involved in the research report produced for the Office of the NSW Building Commissioner on how the building and construction industry in NSW is responding to the NSW Government’s reforms.
The research report, authored by MinterEllison, included our review of a design and construction contract and related agreements from a sample of large mixed use residential projects located in NSW. Visit the Office of the NSW Building Commissioner to learn more about the reform and the report.
Author: David Creais