Building Amendment (Cladding Rectification) Bill 2019 Passed by the Victorian Parliament, Australia

Building Amendment (Cladding Rectification) Bill 2019 Passed by the Victorian Parliament, Australia

The Building Amendment (Cladding Rectification) Act 2019 was passed on November 12, 2019 and received the Royal Assent. The new enacts the State Government’s consumer focused ‘rescue package’ in relation to the funding of ‘cladding rectification work’ associated with ‘non-compliant or non-conforming external wall cladding products’.

The new amendments shall provide Government with power to bring under scanner the dodgy building practitioners on behalf of property owners whose apartments are covered under the combustible cladding. This is done by adding powers to the respective authority as well as through other provisions:

1. confer duty on the Victorian Building Authority with regards to cladding rectification work;
2. financial assistance for building work under the cladding rectification work;
3. provides subrogation of the Crown to the rights and remedies of an owner or the payee who received financial assistance;
4. establish a new category under the Victorian Building Authority Fund; and
5. fund the rectification cladding works by imposing an additional levy on building permits in certain circumstances.  The levy will not apply to buildings in regional Victoria.

The new amendments change the substantive provisions which are in Building Act 1993; the new provision is of subrogation under Section 137F and secondly provision of Repayment of Financial Assistance under 137G.  The key aspects of these provisions are:

1. the Crown’s rights of step in or of subrogation to the owner or the payee.  This implies that the Crown (shall ‘stand in the shoes’ of the owner who received funding for rectification) may bring recovery proceedings against the builder and other industry participants to recoup amounts paid. 
2. the subrogation rights can be exercised in the Crown’s name or in payee’s or owner’s names.  Further, if the Crown’s rights are exercised in the name of the payee/owner, the Crown indemnifies the payee/owner against any adverse costs order in the recovery proceedings
3. the ability to pursue the officers of a company and the company personally which as per the new amendments would be jointly and severally liable.

The amendment shall go a long way in protecting the people from mishappenings of building fires such as Lacrosse Building of Melbourne in 2014, the Marina Torch Tower of Dubai in 2015 and the Greenfell Tower of London in 2017. Henceforth this new law in Victoria to address and avoid any future mishap.