Checklist for engaging building consultants (Vic)

Sometimes the process of building or renovating a home can result in disagreements with the client in respect to whether there is a building defect that requires rectification. It is becoming increasingly common practice for clients to engage building consultants. As the builder, you may consider that the best solution is to also engage a building consultant. Either way, it is important that builders are aware of the requirements surrounding the work of building consultants, who they are and what their range of responsibilities can cover.

What is a building consultant?

A building consultant is a person who acts in a professional and independent manner and will usually have professional qualifications and/or extensive experience in the building and construction industry. 

There are many types of consultants in the building industry. These include, but are not limited to, qualified builders, qualified tradespersons, building surveyors/inspectors, engineers, building designers, architects and quantity surveyors. Some act as ‘general consultants’ while others specialise in a particular area, for example brickwork, structural adequacy, plumbing, estimating, timber, etc.

Do they need to be registered or licensed with the Victorian government?

There is no requirement for building consultants to be registered in Victoria . 

What should you consider when selecting a building consultant?

It’s important to select a building consultant who has the appropriate expertise in the aspect of building work that is in dispute. There is little to be gained from a painter or plumber reporting on construction or contractual matters when neither is experienced in the area of supervising the construction of buildings.

You should request a copy of their resume so you can determine what experience and qualifications they have before you engage them. There is no point in engaging a consultant who has less experience and qualifications than the person who carried out the work you want to have inspected.

What type of insurance should a building consultant have?

Because building consultants are not registered or licensed, there is no mandatory requirement for them to hold insurance. However, as they are providing professional written and verbal advice, it is recommended you ensure they have professional indemnity insurance. This provides protection if the advice from a building consultant gives rise to a claim in respect to loss arising out of negligent performance of their professional activities.

Professional indemnity insurance can be held either by an individual or a company. A person who does not have such insurance may not be acting in a professional capacity or perhaps may be unable to obtain insurance for some reason.

You should always ask and check that a professional indemnity insurance policy is current.

Building consultants do not provide warranty insurance as they are not carrying out any building work.

Will a building consultant favour the person paying for the report?

A building consultant is expected to act in a professionals and impartial manner. Their role is to prepare a report on what they consider to be relevant facts, rather than acting as a ‘hired gun’ for the person initiating the report. As the builder, you may disagree with the client regarding a potential defect, however this may not mean that the building consultant will confirm your position. If there is no clear standard for the area of dispute, then the consultant should note your concerns and discuss the relevance of all possible options in their report.

Should a consultant’s report be in a particular format?

Yes. As a general rule a consultant’s report should be in accordance with the Victorian Civil and Administrative Tribunal (VCAT) Practice Note 2 – Expert Evidence.  This requires the expert, amongst other things, to state their qualifications and experience, provide a statement setting out their area of expertise and for the expert to reference documents they have been asked to consider including any additional material used in preparing the report. If a matter is referred to VCAT, then a report not complying with this Practice Note may be objected to or given less weight at a hearing.

A copy of this Practice Note can be obtained from the VCAT webpage.

Where a general allegation is made about the quality of building work, the consultant should make reference to a specific document to substantiate their conclusions. This may include a contract, specification, design, regulation, Australian Standard, industry code of practice, report or similar. The appropriate clause within that document should then be identified.  

Where an allegation refers to a matter that is not addressed in the contract documentation, then the consultant should make reference to other relevant clause documents, such as theBuilding Commission Standards & Tolerances Guide, or the HIA Guide to Materials and Workmanship for Residential Building Work. If the matters is not covered under these Guides or other industry guides, then a judgement can be made based on the relevant industry experience of the consultant.

The consultant’s report should clearly identify the location and extent of a defect. Vague statements such as “the brickwork on the west wall is out of plumb” only serve to frustrate all parties. The relevant factors would be how much out of plumb the wall is, exactly where on the wall it is and making reference to the appropriate clause in the relevant Standards & Tolerances Guide to quantify the extent of the variation.

What is a fair and reasonable method to query the builder’s costs?

In instances where the consultant needs to verify the cost of any part of the works, or identify the costs to rectify, carry out and complete works, the consultant should provide a detailed breakdown of how they arrived at their decision. The consultant is not tendering for a project where a lump sum figure(s) is the normal outcome; they are providing an opinion on the likely costs for others to consider and as such should be in a position to clearly substantiate how they determined that cost. A simple dollar value such as $1500.00 is not considered appropriate.

Are all building standards legally relevant to my project?

No. Only those standards that are referenced in law, through either in the Building Code of Australia – Volume 2: Housing Provisions, the Victorian Building Act, plumbing and electrical regulations or those identified in your contract documents are required to be met under building legislation. Non-referenced standards do exist, but are not legally required to be met unless called up in the contract.

What is the best way to respond to the findings of a consultants report?

A consultant’s report is not a legally binding document and cannot be used to compel the builder to rectify defects or vice versa, compel the owner to accept a certain level of workmanship if within acceptable tolerances.

A consultant’s report can be a cost effective way to resolve a matter between a client and builder but there generally will need to be some give and take. If it is proven that the builders work may be below standard then this should be addressed by the builder and the owner should accept rectification work that is within tolerances or complies with legislation.

The alternative to this form of conciliation can be getting other parties involved including Consumer Affairs Victoria or the Building Commission. This may then result in the matter going before a tribunal or court for resolution, taking advice from any building consultant’s reports prepared on the work.

For further information HIA members can contact HIA’s Building Services staff on 1300 650 620 or hia_technical@hia.com.au.

If you would like to become a HIA member, contact 1300 650 620 or enquiry@hia.com.au

Ref No. VIC AP 09-04

The above is intended to provide general information in summary form. The contents do not constitute specific advice and should not be relied upon as such. Formal specific advice should be sought by members with respect to particular matters before taking action.  ABN 99 004 631 752