The Residential Apartment Buildings (Compliance and Enforcement Powers) Act 2020 (NSW) (The Act) is a response to the need for overall quality improvement of construction work across NSW, and will ensure the safety of those entering the property market. The obligations apply to class 2 buildings, or a building containing a ‘class 2’ component; typically, residential and mixed-use developments.
Commenced 1st of September 2020
The Act enforces Developers to provide a minimum of six (and no more than twelve) months’ notification to the Secretary of the Department of Customer Service (the Secretary) of anticipated completion dates, to allow active monitoring and regulate the performance of works undertaken. This is to support the early detection of serious building defects. For short-term building works that are to be completed within six months, you must provide notice within 30 days of commencement of the works.
Consequence: Failure to comply will allow the Secretary to issue an order prohibiting the registration of a strata plan for strata schemes and the issue of an occupation certification.
The Act allows for authorised officers to enter the construction site at a reasonable hour without a search warrant to conduct proactive in-depth inspections to detect serious building defects. The inspections include the examination of anything on the site, the taking and removal of samples, records, and opening and demolishing a part of the building work if there are reasonable grounds to a connection of an offence or serious defect.
Consequence: Obstruction, interference, or failure to comply can lead to large fines of $110,000 for a body corporate or $22,000 in any other case.
The Secretary is authorised to issue a stop-work order if it is of the opinion that the building work is (or likely is) carried out in a manner that could result in notable loss or harm, and/or serious damage to property. This allows for the management of non-compliance, with the option to impose additional conditions where applicable.
The Act states that the Secretary can issue work rectification orders and prohibit the issuance of an occupation certificate until the defects are rectified.
Consequence: For Developers, a penalty of up to $100,000 with the added fine of $11.000 for each additional day of the offence. The penalty increases to $300,000 for body corporates, with the added fine of $33,000 for each additional day of the offence.