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Cladding Rectification Bill - Vic

October 17, 2019

On Tuesday the Victorian Government introduced the Building Amendment (Cladding Rectification) Bill 2019 into Parliament.

The Bill follows through on the Government’s commitment to provide financial assistance for cladding rectification. This financial assistance will be funded by an additional building permit levy on multi-storey buildings, certain commercial buildings and when the cost of building work is over $800,000.

The fund and rectification work will be administered by a newly established section of the Victorian Building Authority called Cladding Safety Victoria.

Government suing building practitioners

One aspect of the Bill that has received significant media attention is the proposal to allow the government to sue anyone, including the building practitioners, to recover the cost of cladding rectification.

While the proposal does not change legal liability regarding the responsibility for the cost of rectification work it does extend liability to individual directors of companies retrospectively. This fundamentally challenges the legal protection provided by a company to its directors and HIA will consult with members and government on this issue.

Of specific concern is that under the Bill directors of a company found to be legally responsible for the installation of non-compliant or non-conforming cladding may be sued individually. There is a defence if the director can prove they had no knowledge of or did not consent to the relevant act or omission. This may not be easy especially if the act or omission may have occurred up to ten years before.

Building permit levy and numbering changes

The cladding rectification levy will be an additional levy on top of the current existing building levy requirements already required under the Building Act.

It is also proposed that the building permit levy payable (including the existing and additional levy) would no longer be estimated by the relevant building surveyor but instead be calculated by the VBA.  There is concern that this may cause a delay in the issuing of building permit numbers. The legislation also proposes for a levy for each staged permit.

HIA will be writing to Government to outline our concerns and keep members informed regarding the progress of the Bill.

If you need more information please contact a HIA workplace services advisor on 1300 650 620.