Building Amendment Bill: Will it improve the situation for builders?

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The Building Amendment Bill No 3 was introduced to the House last week as the Government’s latest response to submissions it received to the “Cost Effective Quality: next generation building control in New Zealand”.

The explanatory note to the Bill says there remains heavy reliance on councils to achieve building quality, and concerns about cost complexity and delays in the consent process.
It goes on to say that “change is needed to provide incentives for building professionals and tradespeople to take responsibility for the quality of their work and to stand behind it”.
The implication is that those building professionals and tradespeople are to blame for the increasingly conservative approach of councils.

A common refrain from the DBH is that builders have never had a problem with being accountable for their own work — it’s being held accountable for other people’s choices, and other people’s work and the recognised systemic failure of building controls that led to the leaky building crisis that really grates.
The question is: can these amendments improve the situation for builders?

The accountability framework is meant to be clarified by inserting into the Building Act several clauses that say who’s responsible for what. The Act’s purpose is now also “to promote the accountability of owners, designers, builders and building consent authorities who have responsibility for ensuring that building work complies with the building code”.

The “Principles to be applied” section now includes “the need to ensure that owners, designers, builders and building consent authorities are each accountable for their role in ensuring that:
• the necessary building consents and other approvals are obtained for the proposed building work, and
• plans and specifications are sufficient to result in building work that (if built to those plans and specifications) complies with the building code, and
• building work for which a consent is issued complies with that building consent, and
• building work for which a building consent is not required complies with the building code.”

To bring this accountability into focus, a new section 14A is proposed which is intended as guidance to the parties involved in building work. It states that:
• An owner is responsible for getting the necessary consents, ensuring any work they do complies with the consent (or if no consent required, the building code), and complying with any notice to fix.
• An owner-builder is responsible for ensuring that restricted building work carried out under the owner-builder exemption complies with the building consent and the plans and specifications.
• A designer is responsible for ensuring that their plans, specifications and advice will result in building work that is carried out under the consent complying with the building code, assuming that the work is carried out in accordance with the consent.
• A builder is responsible for ensuring the building work they do complies with the consent and the plans and specifications, or if there is no consent required, that it complies with the building code.
• A council is responsible for checking whether the plans and specifications accompanying an application for building consent comply with the building code, and that building work has been carried out in accordance with those plans and specifications to which the consent relates.

This restatement of Building 101 will hold no surprises to most, but with the increase in classes of exempt building work, the introduction of the owner-builder exemption, and stepped consenting, and the retreat of councils from a lot of the “usual” consent work, it is timely to “spell it out” for all to see.

But will it make any difference at the pointy end of building disputes? The “usual suspects” will still be joined and their contribution to causation examined.
The Government has chosen not to address the joint and several liability framework in this Bill, so the “last men standing” will still have to pay the award of damages, regardless of their actual contribution to the damage.

Retreat of councils
The Bill makes other changes that, potentially, will mean that such situations will impact more heavily on defendants other than council.
The introduction of “stepped” consenting means there will be differing levels of council scrutiny for each type of consent — low-risk, simple, standard, and commercial.

There have also been more classes of building work added to Schedule 1 via the Building (Exempt Building Work) Order 2010, allowing a greater range of work to be done without consent, therefore without council involvement.

While councils are still responsible for issuing consents, the new regime means that, in many instances, council will have discretion on how many inspections it undertakes.
And only in the case of simple and standard consents does council have to satisfy itself on reasonable grounds that the building work complies with the consent before issuing (what will now be called) a “consent completion certificate” (handily, still a CCC).

While the RMBF supports stepped consenting and this easing of regulation, it will be interesting to see how this discretion plays out in future, and whether it results in less opportunity for plaintiffs to join the classic “deep pocket” — the council — into proceedings. Where council is not a party, obviously the burden will fall more heavily on other parties.

There are several other issues and implications in the new Bill that the RMBF will be examining and commenting on, and when the Bill has its First Reading and is sent to a Select Committee, the RMBF will be there advocating on behalf of its members.