Watch The Clock – Practical Tips To Ensure That You Are Within The Statutory Limitation Period To Pursue A Building Complaint

Lot owners in strata arrangements may often be uninformed about the complexities of large buildings and therefore may not be aware of issues pertaining to, amongst other things, poor construction of the common areas, defective structural elements and non-compliant cladding in apartment buildings. Therefore, it is important for both the council of owners (Council) and strata managers managing these schemes to be aware of key timeframes under the relevant legislation so that in the event that things go wrong, the Council’s rights are not foregone as a result of oversight.

Overview of the Building Services (Complaint Resolution and Administration) Act 2011 in the context of strata properties

A complaint under the Building Services (Complaint Resolution and Administration) Act 2011 (Act) may be made by any person who is adversely affected by the carrying out of regulated building services. In the context of strata properties, complaints concerning defects in common property will need to made by the Council.

Timeframes under the Act to pursue a building complaint – what is the applicable date for completion?

There are strict timeframes to pursue a building complaint under the Act. A building complaint will be made out of time if it is made more than 6 years after the completion of the regulated building service.

The legislation and regulations have clearly prescribed when the 6-year period commences from.  The regulations under the Act expressly state that for the purposes of determining the date for completion for work carried out under a building permit, the work is completed when a Notice of Completion of the work is given to a relevant permit authority under the Building Act 2011 (WA).¹ 

A Notice of Completion:

• is a BA7 Form prescribed by the Building Act 2011 (WA) that is lodged with the local council by the builder; and
• must be given to the local council within 7 days of completion of the work for which the permit was granted.

In most cases, the 6-year period commences from the date stipulated by the builder in the BA7 Form. A day late and the Council may lose its right to pursue a building complaint under the Act.

Recent case examples

In The Owners of 52 Mill Point Road Strata Plan 62152 and Hanssen Pty Ltd [2021] WASAT 102, the State Administrative Tribunal (SAT) reiterated that s5(6) of the Act requires 2 things for a complaint to be made to the Building Commissioner:

• the complaint must be made in the manner and form approved by the Building Commissioner; and
• the complaint must be accompanied by the prescribed fee.

In this case, while the prescribed fee was paid within the 6 year period, it was held that a failure to click “submit” to finalise the lodgement of the complaint, resulted in the complaint not being lodged within the 6 year period, notwithstanding that the owners had intended to lodge the complaint.

Owners of 41 Wesley Street Balcatta v DNC Building Co Pty Ltd [2021] WASAT 8 was a case concerning a building complaint which the Building Commission determined to be out of time. In this case, the owners, unaware of the specific date for completion:

• submitted that the builder did not provide it with any information about the date of completion of the building works and that the Council reasonably relied on the information provided by the local government regarding this; and
• relied on the date provided by the builder to the strata manager (the builder
  advised the applicant's strata manager, in November 2014, that the building works were completed in June 2014).

It was not until the applicant had lodged its complaint about the building works with the Building Commissioner that the applicant was first informed that the builder claimed that all building works were completed by 5 May 2014.

The owners argued that that: (1) the complaint was lodged with the Building Commission within the 6- year period and (2) alternatively (if out of time) the Building Commissioner should have accepted the complaint, because it was not long out of time, good reason existed for the late lodgement of the complaint and the builder had known about the matters the subject of the complaint for some time prior to the lodgement of the complaint with the Building Commission. In this case, SAT held that where the difference between the date that the parties assert that the building works were completed is reasonably narrow, there might need to be more inquiries or investigation undertaken in order to ascertain the correct date of completion for the purposes of the legislation. In this case, the difference between the dates was a matter of 17 days.

SAT held that it was wrong for the Building Commission to assume that a complaint would be out of time without investigating the date of completion in accordance with the regulations. Accordingly, the decision of the Building Commissioner to refuse to accept the complaint was set aside and the matter was sent back to the Building Commissioner for reconsideration.

Frequently Asked Questions

What can strata managers do if the Council do not possess a copy of the BA7 Form?

As a starting point, we recommend that you contact the permit authority to obtain a copy of the BA7 form. Typically, this would be the local government authority. The other alternative would be to contact the builder to obtain a copy of the BA7 Form. This is provided that the builder is still solvent.

The 6-year period is soon about to expire and the builder has agreed to rectify certain defects. Does the Council still need to lodge a building complaint?

This will depend on the circumstances and it is best you seek legal advice before the Council foregoes its legal right to lodge a complaint within the 6 year period. Whilst not generally recommended, there may be ways to record your agreement so that the Council’s rights are protected (eg. a deed of settlement).

What can the Council do if they find themselves out of time to pursue a building complaint?

The option to pursue a complaint under the Act is just one avenue to seek relief. There may be other options available to the Council such as looking at commencing proceedings against the builder in a court of relevant jurisdiction for claims such as negligence, breach of contract etc. This will depend on the facts of the case. A lawyer specialising in building and construction disputes will be able to advise you on potential claims you may have.

Key Takeaways

Defects should be an agenda item that is regularly discussed at each council meeting so that it is front and centre of mind.

There may also be some merit in engaging an expert to conduct an inspection prior to the expiration of the 6-year limitation period to assess the condition of the property so that the Council is aware of any defects that have crop up in the 5 - 6 year period.

There are legal implications for the Council and (potentially) strata managers if complaints are not lodged in accordance with the Act and prescribed regulations. When in doubt, it is important to seek legal advice as to the preparation of the complaint as preparing one efficiently and diligently may save the Council costs in the event that the Building Commission refers the complaint to SAT for determination (eg. where the cost to rectify the defects is above $100,000).