Australia: Biggest overhaul of building laws in NSW history – teaser released – what you should expect

Last Updated: 21 March 2019
Article by Scott Higgins, Luke Stirton and Callum Jubb

The NSW Government has recently released its response to the Building Confidence Report that was commissioned by the Building Ministers' Forum (BMF) in August 2017, authored by Professor Peter Shergold AC and Bronwyn Weir, and released in February 2018 (the Shergold Weir Report) ( here).1

This comes in the wake of the Opal Tower and combustible cladding crisis (our articles on these can be found here, here and here) which has seen confidence in our building regulatory system, and the construction industry as a whole, fall to an all-time low.

In its response, the NSW Government announced that it would support the majority of the Shergold Report's recommendations and outlined four major reforms it intends to make across the construction industry.

This article will examine these proposed reforms in their broader context and whilst we await the outcome of the State election to see whether these reforms will be pursued.

New South Wales Reforms:

The NSW Government's response to the Shergold Weir Report included four major proposed reforms, being:

  1. appointment of a Building Commissioner;
  2. overhaul of compliance reporting;
  3. requirement that building practitioners with reporting obligations be registered; and
  4. creation of an industry wide duty of care to homeowners.

It is worth noting that the NSW Government has recently overhauled certifier regulation with the passing of the Building and Development Certifiers Bill 2018 (NSW),which replaced the Building Professionals Act 2005 (NSW).

Building Commissioner

The Building Commissioner appointed under the first reform will act as the consolidated regulator for the construction industry, leading and overseeing building regulation and administration in NSW.

A large part of the Building Commissioner's role will be to audit building plans, to monitor and scrutinise suspected incidents of wrongdoing and to take disciplinary action, such as suspension or cancelling of registrations, and order rectification of building works in circumstances of non-compliance.

Compliance Reporting

Under the second reform the NSW Government will require building designers, architects, engineers and other building practitioners who provide final designs and/or specifications of elements of buildings to declare that the building plans specify a building which will comply with the BCA as well as other relevant building regulations.

These plans will also need to be lodged in digital format with the Building Commissioner and builders will be required to declare that buildings are constructed in accordance with these plans. It will be an offence under the reforms to dishonestly or recklessly declare inaccurate plans or fail to lodge prescribed documents with the Building Commissioner.


For the third reform, the NSW Government will introduce registration schemes for currently unregistered designers and commercial builders who intend to make declarations. Only registered practitioners will be entitled to declare that plans and any proposed performance solutions comply with the BCA, and that a building has been constructed in accordance with its plans.

Duty of care

For the fourth reform, the NSW Government has announced that it will ensure that building practitioners owe a common law duty of care to owners' corporations and subsequent residential homeowners, as well as unsophisticated development clients.

This position is intended to overrule the decision of the High Court in Brookfield Multiplex Ltd v Owners Corporation Strata Plan 61288 (2014) 254 CLR 185 and the Woolcock Street Investments Pty Ltd v CDG Pty Ltd (2004) 216 CLR 515.

Balancing act

Given the extent of these upcoming reforms and the potential for more reforms in the future, there is genuine industry concern that the increase in oversight and regulation may result in additional cost burdens and 'red tape' generally.

The Shergold and Weir Report promoted that its recommendations do not represent an "imposition of unnecessary red tape or bureaucratic overreach".  More importantly, the authors concluded that "there is significant danger that without increased auditing and enforcement, the privatised building approvals process will lead to an ongoing decline in compliance standards."

It is clear that wholesale reform is required and not just to the certification regime, but there is concern about ensuring the reforms are targeted and effective.

On their own, the imposition of duties on professionals to 'sign-off' on designs is unlikely to make substantial inroads to the present compliance problem.  Such obligations already exist under many contracts and the private certification process contains much of the same.  Coupled with clearer liability routes (via duties of care and disciplinary action under the registration and licencing scheme), however, we may see this step in the process taking on more significance.

The consolidation of building regulation and regulatory oversight is long overdue in NSW and were a key plank in reforms recommended in the Lambert review in 2015 as explained in one of our previous articles.  Better enforcement is a key requirement and this requires funding and resources to be committed.

In regards to the planned imposition of a duty of care by all building practitioners, great care should be taken to avoid unintended consequences with such a reform.

In the Lacrosse decision, the absence of a direct duty of care owed by certain building practitioners made the Tribunal's decision much easier to allow complete recovery for the Owners against the head-contractor, LU Simon (with LU Simon bearing the risk of recovering from the architect, surveyor and fire engineer – which it did successfully).

Litigators experienced in managing construction and defect cases will be all too familiar with the benefits and pitfalls that the proportionate liability legislation presents for plaintiffs.

Whilst widening the scope of duties of care may allow for greater avenues of recovery for owners where a head contractor and developer are insolvent, where those parties are available or where insurance would step in, it would be a curious turn of events if owners were instead forced by the new laws to sue everyone in the supply chain  (and bear significant additional costs and risks that come with such multi-party proceedings) simply to obtain recovery.

The fact is that duties of care are already imposed upon developers and builders under the statutory warranties in the Home Building Act and for the benefit of owners.  It is only in circumstances where the limitation period for commencing such actions has expired or where those parties are insolvent or no longer exist that owners need to think further afield for recovery.   These issues, and the application and availability of home warranty insurance (along with its exceptions) should be considered alongside any consideration of extending the duty of care.

The NSW Government will no doubt be looking to the Queensland experience.    In Queensland ,the Building and Construction Legislation (Non-conforming Building Products – Chain of Responsibility and other Matters) Amendments Act 2017 (QLD) ('the Act') introduced a duty of care for all those involved in the supply chain in regard to building products. A more detailed analysis of this can be found in the articles here and here.

What to expect

What can be taken away from the NSW Government's recent announcement is that we can expect a stricter regulatory environment with a great deal more regulatory oversight. There will inevitably be a cost impost and increased risks of liability, however, there is clearly a strong public and industry sentiment that reforms are required to drive greater compliance and improvements in building practices.

With a NSW state election on 23 March 2019, there is no telling how much, if any, of the NSW Government's response will be implemented.  Regardless, we will see no new legislation until the new NSW Parliament sits, at a date that's yet to be determined.

Mills Oakley will keep you informed of developments as more details come to light regarding any new legislative changes.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

To print this article, all you need is to be registered on

Click to Login as an existing user or Register so you can print this article.

Similar Articles
Relevancy Powered by MondaqAI
Some comments from our readers…
“The articles are extremely timely and highly applicable”
“I often find critical information not available elsewhere”
“As in-house counsel, Mondaq’s service is of great value”

Related Topics
Similar Articles
Relevancy Powered by MondaqAI
Related Articles
Up-coming Events Search
Font Size:
Mondaq on Twitter
Mondaq Free Registration
Gain access to Mondaq global archive of over 375,000 articles covering 200 countries with a personalised News Alert and automatic login on this device.
Mondaq News Alert (some suggested topics and region)
Select Topics
Registration (please scroll down to set your data preferences)

Mondaq Ltd requires you to register and provide information that personally identifies you, including your content preferences, for three primary purposes (full details of Mondaq’s use of your personal data can be found in our Privacy and Cookies Notice):

  • To allow you to personalize the Mondaq websites you are visiting to show content ("Content") relevant to your interests.
  • To enable features such as password reminder, news alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our content providers ("Contributors") who contribute Content for free for your use.

Mondaq hopes that our registered users will support us in maintaining our free to view business model by consenting to our use of your personal data as described below.

Mondaq has a "free to view" business model. Our services are paid for by Contributors in exchange for Mondaq providing them with access to information about who accesses their content. Once personal data is transferred to our Contributors they become a data controller of this personal data. They use it to measure the response that their articles are receiving, as a form of market research. They may also use it to provide Mondaq users with information about their products and services.

Details of each Contributor to which your personal data will be transferred is clearly stated within the Content that you access. For full details of how this Contributor will use your personal data, you should review the Contributor’s own Privacy Notice.

Please indicate your preference below:

Yes, I am happy to support Mondaq in maintaining its free to view business model by agreeing to allow Mondaq to share my personal data with Contributors whose Content I access
No, I do not want Mondaq to share my personal data with Contributors

Also please let us know whether you are happy to receive communications promoting products and services offered by Mondaq:

Yes, I am happy to received promotional communications from Mondaq
No, please do not send me promotional communications from Mondaq
Terms & Conditions (the Website) is owned and managed by Mondaq Ltd (Mondaq). Mondaq grants you a non-exclusive, revocable licence to access the Website and associated services, such as the Mondaq News Alerts (Services), subject to and in consideration of your compliance with the following terms and conditions of use (Terms). Your use of the Website and/or Services constitutes your agreement to the Terms. Mondaq may terminate your use of the Website and Services if you are in breach of these Terms or if Mondaq decides to terminate the licence granted hereunder for any reason whatsoever.

Use of

To Use you must be: eighteen (18) years old or over; legally capable of entering into binding contracts; and not in any way prohibited by the applicable law to enter into these Terms in the jurisdiction which you are currently located.

You may use the Website as an unregistered user, however, you are required to register as a user if you wish to read the full text of the Content or to receive the Services.

You may not modify, publish, transmit, transfer or sell, reproduce, create derivative works from, distribute, perform, link, display, or in any way exploit any of the Content, in whole or in part, except as expressly permitted in these Terms or with the prior written consent of Mondaq. You may not use electronic or other means to extract details or information from the Content. Nor shall you extract information about users or Contributors in order to offer them any services or products.

In your use of the Website and/or Services you shall: comply with all applicable laws, regulations, directives and legislations which apply to your Use of the Website and/or Services in whatever country you are physically located including without limitation any and all consumer law, export control laws and regulations; provide to us true, correct and accurate information and promptly inform us in the event that any information that you have provided to us changes or becomes inaccurate; notify Mondaq immediately of any circumstances where you have reason to believe that any Intellectual Property Rights or any other rights of any third party may have been infringed; co-operate with reasonable security or other checks or requests for information made by Mondaq from time to time; and at all times be fully liable for the breach of any of these Terms by a third party using your login details to access the Website and/or Services

however, you shall not: do anything likely to impair, interfere with or damage or cause harm or distress to any persons, or the network; do anything that will infringe any Intellectual Property Rights or other rights of Mondaq or any third party; or use the Website, Services and/or Content otherwise than in accordance with these Terms; use any trade marks or service marks of Mondaq or the Contributors, or do anything which may be seen to take unfair advantage of the reputation and goodwill of Mondaq or the Contributors, or the Website, Services and/or Content.

Mondaq reserves the right, in its sole discretion, to take any action that it deems necessary and appropriate in the event it considers that there is a breach or threatened breach of the Terms.

Mondaq’s Rights and Obligations

Unless otherwise expressly set out to the contrary, nothing in these Terms shall serve to transfer from Mondaq to you, any Intellectual Property Rights owned by and/or licensed to Mondaq and all rights, title and interest in and to such Intellectual Property Rights will remain exclusively with Mondaq and/or its licensors.

Mondaq shall use its reasonable endeavours to make the Website and Services available to you at all times, but we cannot guarantee an uninterrupted and fault free service.

Mondaq reserves the right to make changes to the services and/or the Website or part thereof, from time to time, and we may add, remove, modify and/or vary any elements of features and functionalities of the Website or the services.

Mondaq also reserves the right from time to time to monitor your Use of the Website and/or services.


The Content is general information only. It is not intended to constitute legal advice or seek to be the complete and comprehensive statement of the law, nor is it intended to address your specific requirements or provide advice on which reliance should be placed. Mondaq and/or its Contributors and other suppliers make no representations about the suitability of the information contained in the Content for any purpose. All Content provided "as is" without warranty of any kind. Mondaq and/or its Contributors and other suppliers hereby exclude and disclaim all representations, warranties or guarantees with regard to the Content, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. To the maximum extent permitted by law, Mondaq expressly excludes all representations, warranties, obligations, and liabilities arising out of or in connection with all Content. In no event shall Mondaq and/or its respective suppliers be liable for any special, indirect or consequential damages or any damages whatsoever resulting from loss of use, data or profits, whether in an action of contract, negligence or other tortious action, arising out of or in connection with the use of the Content or performance of Mondaq’s Services.


Mondaq may alter or amend these Terms by amending them on the Website. By continuing to Use the Services and/or the Website after such amendment, you will be deemed to have accepted any amendment to these Terms.

These Terms shall be governed by and construed in accordance with the laws of England and Wales and you irrevocably submit to the exclusive jurisdiction of the courts of England and Wales to settle any dispute which may arise out of or in connection with these Terms. If you live outside the United Kingdom, English law shall apply only to the extent that English law shall not deprive you of any legal protection accorded in accordance with the law of the place where you are habitually resident ("Local Law"). In the event English law deprives you of any legal protection which is accorded to you under Local Law, then these terms shall be governed by Local Law and any dispute or claim arising out of or in connection with these Terms shall be subject to the non-exclusive jurisdiction of the courts where you are habitually resident.

You may print and keep a copy of these Terms, which form the entire agreement between you and Mondaq and supersede any other communications or advertising in respect of the Service and/or the Website.

No delay in exercising or non-exercise by you and/or Mondaq of any of its rights under or in connection with these Terms shall operate as a waiver or release of each of your or Mondaq’s right. Rather, any such waiver or release must be specifically granted in writing signed by the party granting it.

If any part of these Terms is held unenforceable, that part shall be enforced to the maximum extent permissible so as to give effect to the intent of the parties, and the Terms shall continue in full force and effect.

Mondaq shall not incur any liability to you on account of any loss or damage resulting from any delay or failure to perform all or any part of these Terms if such delay or failure is caused, in whole or in part, by events, occurrences, or causes beyond the control of Mondaq. Such events, occurrences or causes will include, without limitation, acts of God, strikes, lockouts, server and network failure, riots, acts of war, earthquakes, fire and explosions.

By clicking Register you state you have read and agree to our Terms and Conditions