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Residential Focus

08 April 2020

#Property & Real Estate

Residential Focus

Know your limitations

Many people and businesses are experiencing delays in completing their routine activities in the face of COVID-19 shutdowns and shortages. Causes include inability to access documents and information held by others, delays associated with working remotely on proxy servers which are as effective as the local internet provider, staff getting up to speed with new applications and other technology. Some businesses have temporarily suspended their operations for the safety of staff.

Governments and other organisations across Australia are asking people to be patient, flagging that current circumstances represent the “new normal” at least until a vaccine is found for COVID-19.

Courts and Tribunals (including NCAT) are operating as usual, but with changes to their operations to allow for electronic filing, electronic exchange of documents and video or telephone hearings, or matters being determined based on written submissions instead of a hearing. Hearings which cannot proceed other than in person are being adjourned.

These circumstances may cause people to assume that deadlines within which to commence proceedings have been relaxed.

On the contrary, there has been no relaxation of the time limits for enforcing statutory warranties under the Home Building Act 1989 (NSW) (HBA).  

On 25 March 2020 the COVID-19 Legislation Amendment (Emergency Measures) Act 2020 (NSW) received assent, having been passed in both houses of parliament. It provides for amendments to be made to the Civil and Administrative Tribunal Act 2013 (NSW) (CAT Act) including:

  • to enable regulations to be made that modify time periods for things done in connection with the Tribunal and the practice and procedure of the Tribunal
  • to enable the Tribunal and certain courts to extend periods for doing things in connection with the Tribunal.

Since that Act was assented to, no regulations have been made to change the limitation periods established by s.48K of the CAT Act, nor have any amendments been made to s.18E of the HBA.

We consider it unlikely that a regulation will be made allowing the Tribunal to accept claims out of time as regards to s.18E, if the relevant limitation periods remain unchanged for claims required to be commenced in a court.

As to whether the power to extend is intended to give discretion to allow claims filed in the Tribunal out of time, we consider this is unlikely for the same reason. Applicants would be well advised not to rely on this aspect of the COVID-19 legislation to permit late commencement of actions. Moreover, the commercial implications for builders and insurers would demand specific drafting should there be an intention to disturb existing rights.

The result is that at present, claims regarding breach of the statutory warranties in section 18B of the HBA, the limitation periods in section 18E remain applicable. That is, proceedings for a breach of a statutory warranty must be commenced before the end of the warranty period for the breach, which is six years from completion of the work, for a breach that results in a major defect in residential building work or two years in any other case.

Authors: Christine Jones and Marie-Louise Scarf

In the media

Sydney, Melbourne Extend Construction Sites Hours
Work hours on construction sites in New South Wales and the City of Melbourne are being extended in a bid to support the industry during the Covid-19 pandemic (02 April 2020).  More...

Building Approvals Rise, But Brace for Fall
Australia’s home building approvals jumped by almost 20 per cent in February, the largest month-on-month gain since 2013, but the extreme economic fallout as a result of the coronavirus pandemic is yet to be seen across the sector (01 April 2020).  More...

HIA: Strong Growth in Building Approvals until the End of February 2020
Building approvals increased by 3.9per cent in the three months to February 2020 compared to the previous three months, providing further evidence that the housing market was accelerating into 2020,” stated HIA Economist (01 April 2020).  More...

MBA: National campaign launched to promote social distancing on building sites
A national advertising campaign has been launched to promote social distancing and strict hygiene on the nation’s building sites (01 April 2020).  More...

Building industry seeks payment reform to ensure survival
The building and construction industry is in danger of collapsing unless emergency measures to address payment delays and non-payments, such as those already in use by the real estate sector, are put in place. That’s the message from Australia’s leading SME trade subcontractors, peak industry bodies, security of payments laws reviewers, advocates and builders (01 April 2020).  More...

Reshaping communities in the wake of the pandemic
The COVID-19 crisis could spur governments, urban planners and developers to think more seriously about creating more healthy, resilient, self-sufficient, attainable and liveable communities in 2021 and beyond (01 April 2020).  More...

Commitment to the Infrastructure and Construction Sector welcomed
The NSW Government’s continued commitment to the infrastructure and construction sector in the face of the ongoing impacts of the coronavirus (COVID-19)pandemic has been welcomed by Infrastructure Partnerships Australia’s Chief Executive, Adrian Dwyer, and should be mirrored across the country (26 March 2020).  More...

Jobs boost through fast-tracked planning process
The NSW Government will cut red tape and fast-track planning processes to keep people in jobs and the construction industry moving throughout the COVID-19 crisis (03 April 2020).  More...

Construction hours extended to support industry during COVID-19
Construction sites can now operate on weekends and public holidays under new rules introduced by the NSW Government to support the industry during the COVID-19 pandemic (02 April 2020).  More...

Carve your future as an apprentice stonemason
The NSW Government’s specialist agency for the restoration and conservation of historic sandstone buildings is looking to hire three apprentice stonemasons to help keep the State’s heritage alive (02 April 2020).  More...

Published - articles, papers, reports

Australian Bureau of Statistics
01/04/2020 Building Approvals, Australia, Feb 2020 (cat no. 8731.0)
25/03/2020 Engineering Construction Activity, Australia, Dec 2019 (cat no. 8762.0)

Practice and courts

ABCC e-alert: Australian Government releases Building Code discussion paper
The Australian Government have released the Code Discussion Paper for the Code for the Tendering and Performance of Building Works 2016. The Attorney-General’s Department is inviting written submissions on the Code’s operation and potential areas where it could be strengthened to ensure it remains fit for purpose. Submissions can be made here IRconsultation@ag.gov.au. The closing date for submissions is 3 April 2020 (18 February 2020).  More...

New NatHERS certificate to be rolled out by 30 April 2020
A new NatHERS certificate will soon come into use as software tools transition to Chenath Engine version 3.21.The new NatHERS certificate has been developed after significant consultation with industry users and will replace the previous “universal certificate” for all new assessments from 1 May 2020. Preview the new NatHERS Certificate
Property Development industry welcomes extension of operating hours on construction sites
April 2, 2020 - Decision of the NSW Minister for Planning, Hon Rob Stokes MP, to extend the hours of operation for the construction sector to include weekends and public holidays.  More...

Cases

Miller v Kadir [2020] NSWCATAP 57
APPEALS – home building - building defect in swimming pool – errors in dismissing claim - in breach of the warranty in s 18B (c) of the Home Building Act 1989 (the HBA)

Hotait v Commissioner for Fair Trading, Department of Finance, Services and Innovation [2020] NSWCATOD 36
ADMINISTRATIVE LAW - administrative review of decision to refuse the applicant’s application for a contractor licence in the category of general building work under the Home Building Act 1989 (NSW) – applicant a director of an externally-administered company - whether there is no evident risk that future work would not be completed - whether applicant took all reasonable steps to avoid external administration

TTM Investment Corporation Pty Ltd v Hua Chang Pty Ltd [2020] NSWSC 294
TTM is to provide an additional $80,000 of security for Mr Lu’s costs of the proceedings. Parties should confer for the purpose of agreeing short minutes of order to give effect to these reasons. Note pars 103 – 105 regarding details to be included in those short minutes.
COSTS — Security for costs — Quantum and form
 Competition and Consumer Act 2010 (Cth); Corporations Act 2001 (Cth); Home Building Act 1989 (NSW)
Uniform Civil Procedure Rules 2005 (NSW)

Hurford Hardwood Kempsey Pty Ltd v Kempsey Timbers (Sawmilling) Pty Ltd (No 5) [2020] NSWSC 287
COSTS – where plaintiff obtained costs order against defendants – application for non-party costs order –defendants now in administration – whether costs order should be made against sole director of and ultimate shareholder of defendants and against another company of which that director was also a director and which had provided financial assistance to defendants – whether costs order should also be made against holding company of defendants
COSTS – whether application for non-party costs order was an application to vary the earlier costs order – where that application neither foreshadowed nor made within 14 days of earlier costs order – whether claim precluded by Uniform Civil Procedure Rules 2005 (NSW) r 36.16(3A) – whether s 14 of the Civil Procedure Act 2005 (NSW) available to allow claim

PA Putney Finance Pty Limited v Aalders and Anor [2020] NSWSC 305
CIVIL PROCEDURE - Registrars - review of Registrar’s decision - refusal to set aside a notice to produce and subpoena - motions arising from alleged breach of settlement agreement - many interlocutory skirmishes - application for freezing order - security for costs - appropriate costs order when motions withdrawn or dismissed

Legislation

Proclamations commencing Acts - Reminder
Better Regulation Legislation Amendment Act 2019 No 23 (2019-623) — published LW 16 December 2019
Schedule 1 amends the following Acts—(a)Building and Construction Industry Security of Payment Act 1999 No 46,(b)Building and Development Certifiers Act 2018 No 63,(c)Building Professionals Act 2005 No 115,

Disclaimer
The information in this publication is of a general nature and is not intended to address the circumstances of any particular individual or entity. Although we endeavour to provide accurate and timely information, we do not guarantee that the information in this newsletter is accurate at the date it is received or that it will continue to be accurate in the future.

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