Compliance in building design - Key findings from Cladding Safety Victoria's recent report

The incorporation of combustible cladding in Victorian buildings has been a scourge on building owners and the Victorian construction industry since coming to the attention of building owners after the Grenfell (UK) and Lacrosse buildings fires and the resulting litigation.

The report considers the causes of the incorporation of combustible cladding into Victorian buildings. It is critical of the design professionals and suggests legal changes to the sector intended to impose a greater burden on those design professionals and new burdens on others connected to a building project.

Introduction

Cladding Safety Victoria (CSV) was established under the Cladding Safety Victoria Act (2020) to facilitate the funding of the rectification of buildings with combustible cladding. It has been actively engaged in managing and funding the removal of combustible cladding in hundreds of buildings in Victoria. Combustible cladding includes aluminium composite panels (ACPs) expanded polystyrene and styrene expanded foam (EPSs).

CSV issued a report following its analysis of the cause of installation of combustible cladding on buildings and who was responsible. Its investigations had access to the design documents submitted for the design process and building permit applications, part of the building approval process.

The report identifies the key building professionals responsible for a building project, as the architect, draftsperson, fire safety engineer and building surveyors and to a lesser extent the builders. It says in most cases those are the parties responsible for decisions that resulted in the incorporation of combustible cladding in buildings.

It concludes that this was primally caused by a lack of understanding of the regulatory process, the application of the Building Code of Australia (BCA) or a failure to appreciate the cladding was combustible.

The prevalence of the problem

The review considered 804 buildings constructed with combustible cladding between 1998 and 2019. It identified the relevant participants in the industry to include the builder, architect, draftsperson fire safety engineer and building surveyor. In the building approval process, each had a role to ensure a building was constructed which was fit for purpose, safe and complied with the BCA.

Criticism of the major players on a building project

CSV considers each of the architect, draftspersons, fire safety engineer and building surveyor played a critical and ultimately causative role in the design process leading to combustible cladding being installed.

It observes that the Victorian regulatory requirements impose duties on building professionals with “overlapping” responsibilities.

The architect or draftsperson specified combustible cladding in the design or failed to specify in detail the cladding to be used, leading to combustible cladding being adopted.

The fire safety engineer failed to critically consider the cladding’s compliance with the BCA or follow necessary review and approval processes whether, they be by the deem to satisfy or performance solution pathway.

The building surveyor issued building permits for designs that included combustible cladding without determining if a performance solution had been engaged. (If there is BCA noncompliance in a building design or the absence of an appropriate approval pathway, the building surveyor must not approve a building permit.)

These failings were identified across all building professionals and projects and not confined to a limited pool of professionals. Thus, the failures were identified as widespread amongst all the professionals.

Failure to follow appropriate processes and pathways

The report suggests the design and approval process was an early and causative factor leading to the installation of combustible cladding. Principally, building professionals specified cladding that they ought to have known was combustible. CSV says 72% of the buildings it considered did not have a documented performance solution to justify the use of combustible cladding.

The report is critical of the frequency by which combustible claddings was specified and installed on buildings in ignorance of the BCA requirements and without proper application and documentation for the approval process. This is particularly so where a designer had adopted a performance solution to approve the use of combustible cladding, but the performance solution had not been properly carried out or documented.

The report does not consider in detail that the possible widespread misinterpretation of the BCA by buildings professions arose from an inherent ambiguity in its provisions. Many building professionals defended their conduct by reference to these alleged ambiguities. Support for this ambiguity argument includes that after the 2014 Lacrosse fire both the Victorian Building Authority and the Australian Building Codes Board issued clarifications or alerts regarding the widespread interpretation of the BCA leading to combustible cladding being installed on buildings. The BCA was also amended in 2016 and 2019 to clarify its application in regard to external cladding and the use of combustible material. Nevertheless, it is correct that the Lacrosse decision[1] in VCAT found that a construction of the BCA relied upon by a building professionals to justify a compliance pathway to permit combustible cladding was not established or reasonable.

Suggested remedies

The report suggests that fundamentally there should be better education for building professional so that they may understand their roles and responsibilities on a building project and the application of the BCA.  

Legislative changes are suggested to make it clear the duty of each relevant building professional for safety quality and all architects, draftspersons and fire safety engineers should be required to certify compliance with the BCA for apartment buildings.

It is suggested a chain of responsibility should be introduced so that all relevant persons involved in the building process, including developers and product manufacturers and distributors are aware of their role and responsibility to ensure buildings are safe and will comply with the BCA. Such changes are likely to override the traditional responsibilities and liabilities of participants in a building project.

The report suggests the relevant building professionals should be required to specify the proposed compliance pathway for key building elements and any reform should place a duty on builders to seek guidance from the relevant professionals for design input.

Observation

The report identified hundreds of buildings constructed in Victoria using combustible cladding which required removal for fire safety reasons and at great cost to building owners.

The issue of combustible cladding has created considerable litigation in Victoria brought by property owners seeking to recover rectification costs. Commonly the builder architect, draftsperson, fire engineer and building surveyor will be a defendant to that litigation. Our courts and VCAT have been kept very busy dealing with the demands of such claims and backlogs have occurred in dealing with them.

We expect these claims will take many years to work through the courts and Tribunal system. Clyde & Co have acted in many of these claims including in the landmark Lacrosse decisions[2].

CSV is charged with funding the rectification of many of those buildings requiring the cladding removal. CSV has a statutory right to commence recovery proceedings against builders and their principals, to recover rectification costs. We are seeing many CSV recovery actions commenced and some challenges to the legislation in the courts.

The CSV report suggests a need for further regulation of the sector. This may include an enhanced legal regime.

The idea that through new legislation, others such as a building developer, product manufacturer and distributor may have a responsibility (and legal liability) beyond their usual contractual arrangements could ensure a greater degree of supervision of building projects for BCA compliance. It also may assist builder owners recovering their losses and reducing the liability of other building professionals responsible for a building's design.

If you require any further information regarding these matters, please contact Ross Donaldson.