The NSW Government has launched a public consultation on its draft Design and Building Practitioners Regulation. The draft Regulation runs to nearly 80 pages and provides important details of the scheme introduced by the Design and Building Practitioners Act 2020 (NSW) (DBP Act). The focus of the draft Regulation is the residential apartment building sector.
As we noted in "New NSW legislation imposes obligations on construction industry and establishes new statutory duty owed to owners", the DBP Act is a vital plank in the NSW Government's building reforms to address widespread quality-related concerns. We are preparing a more detailed note to supplement our Insight on the DBP Act. In the meantime, some notable elements of that Act, as now fleshed out in the draft Regulation, include:
- the DBP Act’s statutory duty of care for pure economic loss will apply primarily to class 2 buildings (multi-dwelling buildings, including apartment buildings) and those which include class 2 buildings; hence, it is likely to cover a "mixed use" tower of the type which led to these reforms, as considered by the High Court in Brookfield Multiplex Ltd v Owners Corporation Strata Plan 61288  HCA 36;
- setting out the administrative requirements for regulated designs, including the form of "design compliance declarations" and the need to lodge for-construction designs (and variations to them) on the NSW planning portal before commencing building work (or within 1 day after commencing the relevant variation to building work);
- there is now considerable detail around the registration requirements for design and building practitioners (the Regulation contemplates 15 classes of design practitioners and seven classes of professional engineer, along with registered principal design practitioners and building practitioners), including prescriptive skills, experience and continuing professional development requirements, and disciplinary and record-keeping arrangements; the Regulation also specifies a raft of information which is to be kept on the register in respect of each registered practitioner;
- a scheme for recognition of professional bodies of engineers, including requirements for their governance and CPD activities;
- building practitioners’ professional indemnity insurance requirements rest primarily upon the practitioner making an assessment of what is appropriate cover in the circumstances, taking into account factors including the risks typically undertaken by the practitioner and how long the practitioner has been registered.However, some overriding requirements for such insurance exist; including that indemnity under corporate and individual policies extends retrospectively to cover work done by the relevant practitioner (registered in the applicable category of design, professional engineering or building work) since they first undertook the relevant class of work;
- codes of practice for various classes of registered practitioner, covering elements including confidentiality and conflicts of interest;
- the civil penalty regime for offences under the DBP Act or the Regulation, with penalties generally at either the $1,500 or $5,500 mark for individuals and $5,000 or $16,500 for bodies corporate.
Submissions are invited (whether formal or via an electronic survey) by 11 January 2021. The Regulation's planned commencement date is 1 July 2021. The consultation website includes extensive explanatory material by way of the Regulatory Impact Statement.
The draft Regulation has, prior to the public consultation, been the subject of consultation with peak bodies across the industry. Given the wide-ranging nature of these reforms, they will no doubt be examined and debated widely, not just in NSW but also – given the ongoing reform processes in other States and Territories under the Building Ministers’ Forum’s "Building Confidence" process – across Australia as well.