Building defects

Time's up

February 16, 2023

Five weeks in the UK, writing and talking with leading lawyers and academics from six nations about the issues facing the world of multi-owned properties with shared common property, has me thinking about three urgent topics:

  1. Our varied responses to the worldwide building safety crisis,
  2. How we mobilise owners en-masse to make our existing housing stock less destructive to the planet, and
  3. Is it possible to develop world standards for socially-just systems that deliver safe and appropriate housing?

While all three are important, and I will be writing about them in the weeks to come, building safety is the immediate issue.

In recent days we’ve read of corruption and the arrest of builders and officials in Turkey connected with collapsed buildings following a devastating earthquake. We read also of the board of another 40-year-old condominium in America ‘mulling’ evacuation because of neglected repairs, as well as a six-week ultimatum to British builders to sign an agreement to remediate buildings with combustible cladding or they will never again get another development approval to build in England or Wales.

Worldwide, there is impatience from regulators and communities at the delays and obfuscation by those responsible to admit fault and pay the price for their misdeeds. In England, there are calls for people to be jailed over Grenfell. For insight into the corporate greed and institutional indifference and incompetence that might warrant jail terms, read Peter Apps’ book, ‘Show Me The Bodies’, How We Let Grenfell Happen’ (Oneworld 2022). It’s a shocking story and an indictment of neo-liberal self-regulation. For the embattled conservative UK government, where cladding is just one issue within a much wider building crisis, they’re vying for developer’s blood, making statements to the parliament along the lines of, ‘You fix this now or you find a new line of work’.

There is impatience too in the USA. The judge responsible for the claims of wrongful death in the 2021 Champlain Towers collapse in Florida insisted that the victims’ families and property owners be compensated within 1 year of the tragedy - and compensation was received with just one day to go.  The judge achieved this by forcing prospective defendants to contribute to a US$1billion compensation fund without a jury trial. The speedy result has private law scholars' heads spinning. It’s worth noting the many and varied roles of those forced to contribute to the fund, including:

  • The condo Board’s lawyers, that allegedly didn’t advise the board to call for an evacuation,
  • The security company that allegedly didn’t handle the evacuation correctly, and
  • The developers of the neighbouring condo development that allegedly contributed to the collapse.

The impatience for justice in these places resonates with the work of the Building Commissioner in NSW, where the scope and pace of reform have been as expansive as they have been expeditious.

But there is one important difference between the response of the NSW government and those elsewhere. The NSW response uses both a carrot and a stick. Get certified, learn to build correctly, take out defects liability insurance and we will praise you - do nothing and we will break you. Elsewhere in the world, particularly where people have died, there are no carrots on offer, and the sticks are out.

There is not much love for builders and developers globally. However,  as Associate Professor Matthew Ball pointed out to me in Oxford at the Building Safety and Private Law symposium, Peter Apps makes an important point in the subtitle of his book, ‘How we let Grenfell happen’ (emphasis added). There is more to this crisis than greed and neglect by building and design practitioners and governments. There are many roles that were played: the lawyer, the buyer, the seller, the marketer, the financier, the academic, the property manager, the journalist and more.

Now is the time for each of us to examine what role we might have played and what we might do to make sure Grenfell and the like don’t happen again.

Michael Teys

Strata expert

Michael is a strata expert with over 30 years experience in strata law and management. He is a strata researcher with City Futures Research Centre UNSW, a consultant to strata industry suppliers, and conducts executive education for strata managers and property processionals.