Some good news…

Home warranty insurance generally protects an owners corporation from being out of pocket for the cost to repair building defects where the builder has been made bankrupt.

But what happens when an owners corporation makes a home warranty insurance claim after the builder’s bankruptcy ends. Is it then too late for the owners corporation to make the insurance claim?

The answer is “no” according to a very recent decision of the NSW Supreme Court.

For further information Strata Home Warranty Insurance Rights

For NSW strata legal or levy collection advice please contact us here or call 02 9562 1266, we’re happy to assist.

Senior Lawyer, Adrian Mueller reminisces…

“In 1980 my parents took me to the Gold Coast for a holiday. It was my first adventure in Queensland. I was 2 years old. We stayed at the (in)famous Iluka hotel.

The Iluka was built in the 1970’s. It was an iconic building – one of the Gold Coast’s first high rises. It had 72 luxury apartments and was a stone’s throw from Cavill Avenue.

It held fond memories for me and, I imagine, many families who enjoyed wonderful times together at the Iluka.

You can imagine my horror when I recently discovered that the Iluka has been demolished. Why? Because of concrete cancer.

You see the owner of the building was faced with a dilemma. Repair the concrete spalling which had been left untreated for decades at exorbitant cost or demolish the building. The owner chose to demolish.

A leading architect Professor Holden, Head of Architecture at the Griffith University in Qld, has said that high rises built in the 1970’s have an average lifespan of 40 years.

That is a sobering thought for apartment owners many of whom cannot afford special levies to repair widespread concrete spalling.

So what is the solution? For some buildings, it may simply be too late. The Iluka is a case in point.

For other buildings, the key is preventative maintenance. As unpalatable as it might be, apartment owners need to realise that spending a little to detect and treat concrete spalling at an early stage saves money in the long run.”

Adrian Mueller also acknowledges that the challenge for strata managers and other stakeholders is to convince owners to invest in proactive maintenance to protect their investment by spending a little in the short term to save big money down the track.

Says  Adrian “Convincing owners to spend now to save later is no mean feat. But it is achievable. And doing so can avoid potential disasters.

I will miss the Iluka.”

Adrian specialises in strata law and those areas of the law that particularly deal with building defects.

“An apartment is someone’s home and most valuable asset. That is something worth protecting and knowing where you stand is vital” says Adrian.

For more information on concrete cancer, visit the following websites – Concrete Cancer or Remedia Structural Repairs

For NSW strata legal or levy collection advice please contact us here or call 02 9562 1266, we’re happy to assist.

Did you know that if your strata scheme has building defects your rights to compensation are subject to strict legal time limits?

If your building is less than 7 years old we can help you navigate through the maze of defect, warranty and insurance claims.

We can provide you with comprehensive advice setting out all of your options for getting the defects fixed or recovering the cost of repairs. We can advise you:

• Who to claim from?
• How to go about it?
• The time limits within which you must act

Miss the time limits – lose your rights!

For NSW strata legal or levy collection advice please contact us here or call 02 9562 1266, we’re happy to assist.

Last week the NSW Court of Appeal delivered two victories for owners corporations and in the process clarified the operation of important areas of the strata legislation.

The two victories involved:

• Access Rights Being Confirmed – The Connaught Case
• The Right to Start Legal Action Being Confirmed – The Gazebo Apartments Case

Click here to read these strata legal cases – Owners Corporation Rights Vindicated

For NSW strata legal or levy collection advice please contact us here or call 02 9562 1266, we’re happy to assist.

Fair Trading NSW has confirmed that the 1 December 2014 commencement date for the NSW Home Building Amendment Act 2014 has been delayed to 2015.

The amendments will commence in two stages:

Stage 1:
It is anticipated that the critical change surrounding statutory warranties will commence mid-January 2015. The critical change to the warranties will be a shift from “structural defect” (which is the current position) to a warranty which will only cover a building defect which is a “major defect”.

If the defect is categorised as a “major defect” it will enjoy a 6 year warranty otherwise any defect which is not a major defect and/or a non-major item will only have a warranty for 2 years. The new definition of “major defect” will be more restrictive than the current definition of a “structural defect”. The new amendments will have retrospective effect.

Stage 1 will also have other amendments commencing mid January 2015 and they are as follows:

1. For the first time, statutory warranties will be implied into subcontracts entered into by the principal contractor who undertakes residential building work. These changes will allow an owners corporation to enforce warranties as a successor in title against subcontractors.
2. If a defect arises due to an owners defective design or specification the builder will not be held liable for that defect.
3. Within 6 months the owner must notify the builder and the subcontractor of a defect. If the owner fails to do so such a failure may result in the reduction of any damages.
4. Owners must not unreasonably refuse access to a builder who wishes to rectify the defect.
5. Courts will be required to give priority to rectification orders as opposed to monetary orders.

Stage 2:
This stage will involve the provisions that relate to re-drafting of contracts. The contracts will have to comply with the amending legislation hence these will be dealt with in the second quarter of 2015.

For NSW strata legal or levy collection advice please contact us here or call 02 9562 1266, we’re happy to assist.

• 11 Days until 1 December 2014!
• Do not get caught out!
• The time to act is now!
• Have your buildings inspected by a building consultant to check for defects!
• Avoid losing your rights to make a building defect claim!

1 December 2014 the home building legislation in NSW will change. The changes to the legislation may mean that some owners corporations will lose all of their rights to make claims for building defects.

• 34 Days until 1 December 2014!
• Do not get caught out!
• The time to act is now!
• Have your buildings inspected by a building consultant to check for defects!
• Avoid losing your rights to make a building defect claim!

At JS Mueller & Co we work with a number of reputable building consultants and engineers. We can organise a building inspection for any building that you manage to check for defects before the 1 December deadline.

But you must act quickly otherwise you may run out of time.

If you would like to discuss the changes to the NSW home building legislation or have JS Mueller & Co organise a building inspection, please contact us now on the details below.

For NSW strata legal or levy collection advice please contact us here or call 02 9562 1266, we’re happy to assist.

• 39 Days until 1 December 2014!
• Do not get caught out! 
• The time to act is now!
• Have your buildings inspected by a building consultant to check for defects!
• Avoid losing your rights to make a building defect claim!

Today, 8 October 2014, the High Court of Australia in the case of Brookfield Multiplex Limited –v- Owners Corporation Strata Plan 61288 & Anor [2014] HCA36 unanimously allowed an appeal by Brookfield Multiplex Limited from a decision of the Court of Appeal of the Supreme Court of NSW holding that Brookfield, the builder of a strata title apartment complex, did not owe a duty of care to the owners corporation of the complex to avoid causing financial loss resulting from latent defects in the common property.

The judgment of the High Court now confirms once and for all that generally the only claim available to an owners corporation for building defects is a claim for breach of statutory warranties under the NSW Home Building Act 1989.

Prior to this High Court decision, owners corporations were entitled to sue for breach of statutory warranties under the Home Building Act and also for breach of duty of care, i.e. in negligence at law.

Unfortunately, the High Court has now held that in general an owners corporation can only sue for breach of statutory warranties, but cannot sue a builder in negligence for a breach of duty of care because the builder does not owe a duty of care to the owners corporation.

For further commentary on this recent judgment of the High Court of Australia please view the following links:

1. Brookfield Multiplex Ltd v Owners Corporation Strata Plan 61288 & ANOR
2. Brookfield Multiplex Ltd v Owners Corporation Strata Plan 61288 [2014] HCA 36 (8 October 2014)

For NSW strata legal or levy collection advice please contact us here or call 02 9562 1266, we’re happy to assist.

According to a recent survey, 85% of new strata buildings suffer from building defects.

Sometimes the builder responsible for the defects wants to return to repair them.

But do you have to allow the builder back particularly if you don’t want to?

To view the full article click here – Building Defects and Your Builder

For NSW strata legal or levy collection advice please contact us here or call 02 9562 1266, we’re happy to assist.