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ACT CIVIL & ADMINISTRATIVE TRIBUNAL

KOUNDOURIS v CONSTRUCTION OCCUPATIONS

REGISTRAR & ORS (Administrative Review) [2015] ACAT 92

AT 99/2013

Catchwords: ADMINISTRATIVE REVIEW – rectification order – water

ingress – façade cracking – whether rectification order made

outside the ten year time limit

Legislation cited: Building Act 1972 ss 37, 40A, 41A

Construction Occupations (Licensing) Act 2004 ss 34, 35, 36,

38, 40

Subordinate

Legislation: Australian Standard 3700 s 2.5.2.2

Building Code of Australia 1996, Volume 1, Amendment

number 11 ss FP1.3, FP1.4

Tribunal: President W.G. Stefaniak AM RFD

Senior Member G. Lunney SC

Senior Member G. Trickett

Date of Orders: 23 December 2015

Date of Reasons for Decision: 23 December 2015

ACT CIVIL & ADMINISTRATIVE TRIBUNAL AT 99/2013

BETWEEN:

RE: MICHAEL

KOUNDOURIS

Applicant

AND: CONSTRUCTION

OCCUPATIONS

REGISTRAR

Respondent

AND: ROBERT FARRELL

First Party Joined

AND: EDWARD PURRER

Second Party Joined

AND: THE OWNERS - UNITS

PLAN 2340

Third Party Joined

TRIBUNAL: President W.G. Stefaniak AM RFD

Senior Member G. Lunney SC


DATE: 23 December 2015

ORDER

1. The rectification order made by the Registrar will be set aside and another

substituted. The matter will be listed for settling a rectification order. The

respondent should circulate a draft order to the parties not later than two weeks

prior to the listed hearing date. The other parties should circulate suggested

amendments not later than five days prior to the hearing date.

……signed………..

President W. G Stefaniak AM RFD

for and on behalf of the Tribunal

2

ACT CIVIL & ADMINISTRATIVE TRIBUNAL AT 99/2013

BETWEEN:

RE: MICHAEL

KOUNDOURIS

Applicant

AND: CONSTRUCTION

OCCUPATIONS

REGISTRAR

Respondent

AND: ROBERT FARRELL

First Party Joined

AND: EDWARD PURRER

Second Party Joined

AND: THE OWNERS - UNITS

PLAN 2340

Third Party Joined

TRIBUNAL: Senior Member G. Lunney SC


DATE: 22 July 2016

This Rectification Order under the Construction Occupations (Licensing) Act 2004

(COLA) is made in substitution for an Order of 21 November 2013 by the Construction

Occupations Registrar after review by the ACT Civil and Administrative Tribunal of

that Order.

In this Order the following abbreviations are used

‘EC’ refers to the Executive Committee, the owners, Units Plan No. 2340

‘Diagnostech’ or ‘the Diagnostech Report’ refers to a report dated 17 August 2012

prepared by Diagnostech Pty Ltd and which was annexed to a notice issued

pursuant to Section 34 of COLA in this matter.

‘COLA’ refers to the Construction Occupations (Licensing) Act 2004.

‘the builder’ refers to Michael Aristidis Koundouris.

‘the parties’ refers to the parties to ACAT proceeding AT99/2013

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‘the residents’ refers to the residents of Block 24 Section 43 Turner in the ACT.

‘the Assessor’ refers to the individual appointed pursuant to Clause 5.

This Order is issued to Michael Aristidis Koundouris the holder of an ‘A’ class

builder’s licence of 3 Torrens Street Braddon ACT in the Territory. It relates to

building work undertaken by him at Block 24 Section 43 Turner in the Territory.

ORDER

1. The work the subject of the Order is to be completed by the builder within 7

months of the date of the making of this Order.

2. All work is to be done in a proper and skilful manner using new materials suitable

for the purpose for which they are used and which comply with the standards

under the Building Code of Australia applicable at the time of use.

3. Within 28 days of the date of this Order the builder shall prepare and serve on the

parties a schedule of his estimate of the program of execution of works which shall

include an estimate of access, and storage requirements; and of work involving

loud noise, vibration or unpleasant odours.

4. During the execution of work the builder shall give reasonable notice of the

matters referred to in the previous clause to the residents and subject to this Order

shall use his best endeavours to meet their reasonable convenience in undertaking

work.

5. Before commencing rectification work the builder shall appoint an Assessor who:

(a) shall be a qualified Building Surveyor licenced under COLA;

(b) shall be appointed in consultation with the Registrar. Should agreement not

be reached within seven days of nomination of a proposed individual by

either party, the President of the Master Builder’s Association or his

appointee shall appoint the Assessor;

(c) shall inspect the works as they progress at intervals consistent with the

stages of progress of the works and issue a Certificate in respect of

completion of each item of the works certifying that in his opinion it

4

complies with Clause 2 of this Order, and provide each of the parties with a

copy;

(d) in the event that a dispute arises between any of the parties in relation to any

of the works to be undertaken pursuant to the Order, the Assessor shall use

his/her best endeavours to bring about a resolution of the dispute, and may in

their discretion:

i offer their opinion on any aspect of the dispute; and

ii in default of agreement between the parties to the dispute, decide the

dispute or any aspect of the dispute.

6. Should the works be delayed by weather, availability of materials, or other

sufficient cause, the Registrar may allow up to a further two months for

completion. All work must be completed no later than nine months from the date

of this Order.

7. In complying with this Order, the builder is required to:

(a) Meet all costs associated with the work done and with compliance with this

Order including the costs of the Assessor.

(b) Comply with all relevant applicable laws and pay for the costs of such

compliance.

(c) Reinstate or make good any damage to property, services and equipment as a

result of the execution of the works and non-compliant work the subject of

this Order.

(d) Remove and dispose of waste generated by the works.

Individual Issues

Façade Cracking

8. Generally all work is to achieve a proper and neatly finished surface to match

adjoining surfaces to the full extent of the brick-veneer façade; to brickwork

encasing steel columns, and including to rendered surfaces

9. All cracks of 1mm or more should be rectified. The work required for rectification

will vary according to the type of crack

5

Expansion Joints

10. Expansion joints shall be inserted in the facade, the location and installation of

which shall comply with the Masonry Code AS 3700. Locations shall not reduce

the strength of the veneer and may be governed by the existing crack locations The

builder shall prepare and serve on the Registrar a plan of the proposed work not

less than seven days prior to the commencement of the proposed work.

11. All joints shall be saw-cut full height and formed with appropriate sealant and

backing rod installed strictly to the sealant manufacture’s specification in a neat

and workmanlike method.

12. Bed jointing is to be removed to allow the installation of proprietary masonry

articulated expansion ties to bed joints at every 4th course to the height of the saw

cut expansion joint. Compressible closed cell joint filler is to be installed to the cut

joint after installation of ties, and the bed joints are to be fully mortared up leaving

the vertical cut joint free of mortar.

Articulation Joints

13. Articulation joints shall be formed at the junction of dissimilar materials and at

joints in dissimilar underlying substrates. Joints shall be 10mm wide and formed

with appropriate sealant and backing rod and closed cell compressible filler

installed strictly to sealant manufacture’s specification in a neat and workmanlike

method

Cracks in the depth of the render only

14. These cracks shall be repaired after the above control joints have been installed.

15. All cracks 1mm wide to 5mm shall be repaired by raking out the crack and filling

with non-shrink flexible filler.

Cracks through the depth of the render and into the brickwork

16. These cracks shall be repaired after the above control joints have been installed.

17. All cracks greater than 1mm wide and extending into the brickwork shall be

repaired as follows. Cracks less than 5mm wide shall be repaired as for “Cracks in

the depth of the render only” with the brickwork raked out and non-shrink flexible

filler injected to extend into the brickwork for the full depth of the crack. Cracks

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greater than 5mm but less than 15mm may be repaired the same way but work

may involve breaking out and replacing small sections of brickwork which shall

be fully bonded into the existing wall. Affected areas of adjacent render shall be

square edge cut so that no feather edges result. Render and primer shall be

installed to the manufacture’s specification and properly cured all to match

adjacent surfaces.

18. For cracks in the brickwork greater than 15mm wide the rectification work is to be

determined by a qualified structural engineer engaged by the builder.

Penetration of water from balconies into habitable units

19. The balconies to Units 26, 28, 29 & 30 shall be exposed and a torch-on membrane

applied as set out in the Diagnostech Pty Ltd report at T348-T352 and attached as

Appendix 1 titled “Waterproofing Works – Level 3 Balcony Deck Waterproofing

Works”; Clauses 3.1.1 to 3.1.9 inclusive. Ceramic tiles are to match existing tiles.

Water testing is to be carried out for the full extent of the membraned areas by

water ponding for 36 hours and inspecting the ceiling spaces below. Work is to be

rectified if leaks appear. The appointed Assessor is to inspect work as a minimum:

prior to membrane application, prior to installation of tile bedding at the end of the

ponding period, and at completion of tiling with control joints installed. Tiles and

bedding presently used as a cover should be disposed of by the builder.

20. Undertake remediation works as described and to standard described in Appendix

2 ‘Internal Repair Work’, items 2.2 and 2.3

21. Work to be done is set out in the table set out below.

7

Unit Diagnostech defect

number

Level Problem Rectification required

18 133 2 East face, under Unit 26,

water penetration

through ceiling

Rectify Balcony off bed 2

Unit 26. Repair internal

damage to ceiling

19 146,147 2 South East corner under

Unit 26, water

penetration through

kitchen, living room

ceiling

Rectify E & S Balconies Unit

26. Repair internal damage to

ceilings of kitchen & living

room. Replace carpet &

underlay

21 158 2 West face, under Unit

28, water penetration

bedroom ceiling

Rectify Balconies off Unit


ceiling of bedroom

22 164/5/6 2 West face under Unit 28,

water penetration

through living room

ceiling and wall

Rectify Balconies Unit 28.

Repair internal damage to

ceiling of living room, west

wall & skirting, & architraves

to living room window

23 172

3 South West corner, water

penetration through

bedroom 1 wall



wall of bedroom 1

24 179-182 3 North West Corner,

water penetration

through bedroom 2

wardrobe



bedroom 2 wardrobe walls &

ceiling

25 188/189 3 West face, water

penetration through

living room ceiling



living room ceiling

26 196-204 3 North East corner, water

penetration at floor level

in bedroom, kitchen,

Mansard roof space

Rectify Balconies. Repair

internal damage to walls,

skirtings & replace carpet.

Repair damage to mansard

roof structure by replacing

rotted timber with durability

class 2 timber & repairing

steel work by removing rust

& fully coating with

Jotaprime

27 208 3 South East corner, water

penetration damage into

Mansard roof

Repair damage to mansard

roof structure by replacing

rotted timber with durability

class 2 timber

28 215/17 3 South West corner, water

penetration damage in

Bedroom 1, Bedroom 2

& living room


internal damage to thresholds

& skirtings

8

Basement car park roof

22. The podium area of the basement roof including the roof to the Waste

Management area; the inside of the planter boxes, and the set down covered front

northwest garden area outside Unit 2, including the walls from the set down up to

the adjacent podium roof, shall be exposed and a torch on membrane applied as

described in the section related to “Penetration of Water from Balconies into

Habitable Units” above.

23. Concrete pavers and sand presently used as a cover should be disposed of by the

builder.

24. The membrane is to extend up to the outside face of the ground floor walls at the

podium level, however unlike the work to the balconies no existing wall material

and thresholds are to be demolished.

25. The surface of the podium including the roof to the Waste Management area shall

be tiled with non-slip ceramic tiles of a neutral colour satisfactory to the EC and

laid to fall away from the building. The area of membrane to be covered with

earth, including the walls, should have a protection board laid on top of it prior to

back filling.

Corrosion of structural steel to balconies, and mansard roofs

26. For methodology refer to pages T364 (Corroded Steel Repair) and T783

(Structural Steel Work Finish numbered F3) from the Tribunal Documents

attached hereto as appendixes 3 and 4. Adjust method as appropriate for specific

29 219-220, 3 South West corner, water

penetration in Bedroom

1 & Bedroom 2


internal damage to thresholds

& skirtings

30 235-239 242/3 3 North West Corner,

tiling on balcony, water

penetration in living

room, kitchen. Damage

to structures in Mansard

roof


internal damage to kitchen

threshold, living room

skirting. Repair damage to

mansard roof structure by

replacing rotted timber with

durability class 2 timber &

repairing steel work by

removing rust & fully coating

with Jotaprime

9

situations.

27. Rust shall be removed using power or hand tools including wire brushes, needle

gun, sanding, etc. Where surfaces have previously been painted the adjacent

painted areas that are unsound shall be removed and the sound areas shall be

sanded to a feather edge termination. Surfaces shall then be cleaned to remove

contaminants.

28. Priming: Affected steel to basement, other than the lintel beam to Waste

Management entry, shall be coated with Luxaprime zinc phosphate to a dry film

thickness of 75 microns.

29. The appointed Assessor shall inspect all work prior to application of the finishing

coats.

30. Application of finishing coats is to be by brush, roller or airless spray providing

the equivalent of two full gloss coats to the full extent of structural members

including already painted surfaces. Paint to be compatible with primer and existing

painted surfaces.

31. Work in relation to the balconies is to be done as identified in the following table.

Unit

No.

Ref

Diagnost

Description Remediation

31 18 Corroded balcony

support steelwork.

Inadequate protective

coating

Remove rust. Fully coat with Jotaprime

before two finishing coats

18 25 Corroded balcony

support steelwork.


coating system



134 Corroded lintel beam,

balcony. Inadequate

protective coating

system



19 140 Corroded lintel beam.



10

coating system before two finishing coats



coating system





coating system





coating system



32 21 Not in RO, in Rpt

Jeffry. Corroded

balcony support

steelwork and

balustrade. Inadequate

protective coating


before two finishing coats Repair

cracked tiling

26 D191 Not in RO, in Rpt

Jeffry. Corroded

balcony post.


coating system



D200-203 Corroded support

steelwork in Mansard

roof space on balcony

due to water entry



30 D230/1,23

3,

Not in RO. Corroded

balustrade, balcony

post. Inadequate

protective coating



242 Corroded support

steelwork in Mansard

roof space on balcony

due to water entry



Repair to basement structural steel including lintel over garbage storage room

32. Rectify by the method previously described all corrosion to structural steel in the

basement. Instances of the work to be done are identified in items 11, 12, 13 and

15 of the Diagnostech Report attached hereto as Appendix 5. Where corrosion

extends beyond area depicted in the photograph continue rectification work

11

appropriately.

33. In relation to the steel column on grid 5 adjacent to grid H in the waste

management room of the basement, item 85 of the Diagnostech Report at

appendix 6, rectify corrosion at base of column. Expose base of column below

level of surface of concrete to a depth sufficient to determine extent of corrosion

below the surface. Engage a structural engineer to determine the method of

rectification to provide a 30 year structural soundness and rectify in accordance

with advice.

34. In relation to the lintel beam over the entry to the waste management room shown

in Diagnostic Report item 43 in appendix 6, after exposure when undertaking

podium work referred to above, replace the beam unless a certificate is obtained

from a structural engineer and served on the Registrar and Assessor that after

repair (which is undertaken) the lintel has a 30 year structural soundness.

Rectification of parapet capping

35. Remove existing parapet capping and fixings to Units 26, 27 and 28 which is to be

disposed of by the builder.

36. Provide to the whole of the wall parapets to Units 26, 27 and 28 “Colorbond”

metal capping in long lengths side fixed securely at 900mm centres into adequate

support. Fixings to have horizontally slotted holes to allow for expansion. If fixing

directly into brickwork the fixings are to be into the second top course of

brickwork. Joints to be lapped 150mm, sealed and to allow for thermal movement.

Rectification of gaps in mansard roofs

37. Remove existing damaged or poorly installed capping/flashing and tiles to the

mansard rooves of units 26 and 30 which are to be disposed of by the builder.

Replace and repair all work with matching materials, and “Colorbond” metal

capping/flashing in long lengths.

………………………………..

Senior Member G Lunney SC


12

Appendix 1

17

Appendix 2

18

Appendix 3

Appendix 4

20

Appendix 5

22

Appendix 6

23

REASONS FOR DECISION

1. This is an application for review of a decision by the Construction Occupations

Registrar (the respondent or Registrar) to issue a rectification order against the

applicant builder, Michael Koundouris, in respect of a block of units at block 24

section 43, Turner in the ACT.

2. The applicant is a class A builder and is the nominee of a company which

developed the site by erection of a block of 32 units and an underground

carpark.

3. Approval for construction of the building was issued on 27 September 2002. On

21 October 2003 a certificate of structural sufficiency was issued, and on

25 November 2003, the respondent issued a certificate of occupation and use.

4. The units were purchased and in due course, the owners identified some

difficulties in their use of the premises that they alleged were due to defects in

the construction of the building.

5. On 1 November 2012, a unit owner who was a member of the Executive

Committee of the Owners Corporation lodged a complaint regarding the quality

of the building work with the Registrar.

6. Investigations were carried out, and on 9 August 2013, the respondent issued a

notice of intention to issue a rectification order. The rectification order which

was issued by the respondent and which is the subject of this application was

issued on 21 November 2013.

Reference

7. The following abbreviations have been used in the text of these reasons.

Referenced sections from the relevant legislation have been reproduced at

Appendix 1.

‘BA’ – Building Act 1972

‘BCA’ – Building Code of Australia 1996, Volume 1, Amendment number 11

‘COLA’ – Construction Occupations (Licensing) Act 2004

24

‘section 34 notice’- The notice issued by the Registrar pursuant to section 34 of

COLA on 9 August 2013

The Complaint

8. The complaint was on a departmental form prepared for that purpose and was

stated to be submitted on behalf of the Owners Corporation. It was accompanied

by a report prepared by Dennis Stephenson, the principal of building

consultancy firm ‘Diagnostech’ and which was dated 17 August 2012.

9. The complaint referred to the following as being ‘the key issues’:

(a) Water ingress into residential units and associated damage.

(b) Water ingress into basement and garbage room – resident property and

corrosion of structural steel work and concrete slab damage.

(c) Premature degradation of building façade and structural cracking.

(d) Premature corrosion of steelwork, internally and externally.

(e) Lack of compliance with fire safety regulations with regard to fire stairs

and protective coating to structural steelwork.

10. The report of Mr Stephenson was extensive and included a large number of

photographs which had been taken of or concerning alleged building defects.

Each defect that he reported was accompanied by a photograph and a brief

description.

The Notice of Intention

11. After receipt of the complaint, the respondent arranged inspection of the

premises, took the steps referred to in part 4 of the COLA and issued a notice of

intention to issue a rectification order on 8 July 2013.

34 Intention to make rectification order

(1) This section applies if the registrar believes on reasonable grounds that—

(a) a licensee or former licensee (the entity) has provided a construction

service otherwise than in accordance with this Act or an operational

Act; and

(b) it may be appropriate to make a rectification order.

Examples of licensee or former licensee

1 a licensed builder does building work

2 a drainer who was licensed, does sanitary drainage work while

unlicensed

25

3 a licensed gasfitter does gasfitting work and then becomes unlicensed

Note 1 If deciding under this section whether it may be appropriate to

make a rectification order, the registrar must consider the

considerations mentioned in s 36.

Note 2 An example is part of the Act, is not exhaustive and may extend,

but does not limit, the meaning of the provision in which it

appears (see Legislation Act, s 126 and s 132).

(2) The registrar may give the entity, and the land owner in relation to whose

land the construction service was provided, a written notice that—

(a) gives details of the rectification order that may be made; and

(b) explains why the registrar intends to make the order; and

(c) invites submissions about the making of the order within the time

stated in the notice that is not less than 5 working days after the day

the entity or land owner receives the notice; and

(d) states that—

(i) the registrar will not make a rectification order if the registrar

is not satisfied that it is appropriate to make a rectification

order in relation to the entity; and

(ii) if the registrar does not make a rectification order the Territory

may authorise someone else to do the things stated in this

notice, and the entity will have to pay for the things to be done.

12. The section 34 notice according to sub-section 34(1) should give details of the

rectification order that may be made; and, explain why the Registrar intends to

make the order.

13. In this case, the Registrar in the notice advised the applicant that he was

investigating a complaint regarding the subject building, and that it may be

appropriate to make a rectification order. He then outlined the history of the

complaint.

14. The notice went on to set out the Registrar’s explanation for considering the

making of an order. It states that section 37 of the Building Act 1972 requires

that all building work be carried out in compliance with the BCA, and goes on

to list eight categories of defect that allegedly breach the BCA and set out

corresponding performance requirements. These allegations drew on the report

of Mr Stephenson. A summary of them follows:

1) Cracking of external façade.

2) Penetration of water into carpark roof.

3) Penetration of water into ceilings and walls of units.

26

4) Penetration of water from balconies into units.

5) Corrosion of steel framework in balconies.

6) Failure of waterproofing in bathroom areas.

7) Defective parapet capping.

8) Defects in roofing.

15. This part of the notice concludes as follows:

In considering the criteria under section 36 of COLA, I have reason to

believe that the construction of the waterproofing, drainage, roofing and

external facade, fails to comply with the approved plans and standards

stipulated in the Building Code of Australia.

16. The section 34 notice then sets out proposals for a rectification order consisting

of a timetable for investigation and execution of work found to be defective.

17. It is appropriate to note at this stage that section 35 of the COLA provides a 10

year time limit on the issue of a rectification order. This provision will be

referred to again later.

18. The applicant responded to the section 34 notice on 11 October 2013,

immediately raising the limitation period just mentioned. This submission was

developed by the applicant at the hearing and will be dealt with in due course in

these reasons.

19. The applicant’s response also included two expert reports from a structural

engineer and an ‘experienced building and construction expert’ who were later

called to give evidence.

20. The response also alleged that the owners of the units had failed to properly

maintain the building, and that there had been no breach of the BA or the BCA.

21. The respondent issued the rectification order on 21 November 2013. It was

served on 25 November 2013.

22. It identified the same eight areas of alleged defect referred to above which were

the subject of the section 34 notice.

27

23. The applicant filed an application for review of a decision dated

16 December 2013 on the same date. It sought review of the rectification order

of 21 November 2013.

The hearing

24. This proceeded in the usual manner with the applicant calling his evidence first.

Unfortunately because of the extended time taken by the hearing, the need to

adjourn from time to time, and the availability of witnesses, it was necessary to

take some witnesses out of order.

25. Two owners of units in the building as well as the Owners Corporation were

joined to the proceedings, and in combination the Owners Corporation and the

individual owners called evidence and cross examined witnesses.

26. Evidence was concluded on 30 July 2015 and directions were given for the

preparation and filing of written submissions.

Issues

27. The decision which is the subject of review is the decision to issue the

rectification order. That decision was preceded by another one, and that was to

form the intention to make a rectification order and issue a section 34 notice as a

consequence. The content of the section 34 notice will have a bearing on the

content of the rectification order. The applicant submitted that the terms of the

section 34 notice constrained the terms of the rectification order that could be

made.

28. Section 34 permits the Registrar to issue a section 34 notice if a construction

service has been provided by a licensee otherwise than in accordance with

COLA or an operational Act, and the Registrar considers it appropriate to do so.

Section 34(2)(a) provides that details of the ‘rectification order that may be

made’ must be provided. It is the provision of the construction service and its

nature which is the precondition for the issue of the section 34 notice, and

indeed for the later making of a rectification order and details must be given.

Detail of the actions required for rectification must also be given.

29. Both the section 34 notice and the later rectification order referred to two

separate areas. The first was specification of the defects alleged; and the second

28

was a direction regarding the appointment of an engineer to assess those alleged

defects and describe the matters found to be defective with the applicant being

required to rectify those defects. The second matter was something which was

ancillary to the statutory requirements.

30. Section 35 makes it clear that a rectification order can be made if the entity

provided part or all of the construction service to which the notice related; and,

the Registrar after considering submissions considers that there has been

contravention and it is appropriate to make an order.

31. The Tribunal takes the view that section 35 contemplates the possibility of some

change in the position of the Registrar after considering submissions following

the service of the section 34 notice with the possibility of some consequent

variation in the precise terms of the rectification order made comparative to the

order proposed in the preliminary notice. Section 34 refers to an order that may

be made, and in some cases it may be a question of degree when comparing the

proposed terms of the section 34 notice with those made in the final order.

Adequate warning of the defects alleged to constitute breaches must be given.

Methodology

32. There is a great deal of evidence. The transcript runs to 2626 pages, and all

parties filed statements of the evidence of witnesses prior to their being called.

The eight issues listed in the section 34 notice formed the focus of the evidence,

and the applicant raised a number of preliminary issues prior to evidence being

given.

33. Since these were raised by the applicant both in his opening and in written

submissions, it is appropriate to examine these to the extent necessary at this

stage prior to moving to the individual items in the rectification order. Those

issues are listed at paragraph 17 of the applicant’s written submissions.

Time – Section 35(3) of the COLA Act

34. This issue was raised by the applicant at the commencement of the hearing. The

Tribunal was invited to deal with it as a preliminary issue, however, that was

not considered appropriate and the hearing proceeded. However, it has remained

as a matter for determination by the Tribunal. The applicant submits that sub-

29

section 35(3) of COLA applies and that the time in which a valid rectification

order (RO) could be made had expired. Sub-section 35(3) is reproduced below.

(3) However, the registrar may not make an order under section 38 in relation

to the entity if a submission is made that satisfies the registrar that the act

that caused the contravention happened, or ended, more than 10 years

before the day the registrar proposes to make the order.

Example of contravention

A builder built a house without a building approval. The registrar is satisfied that the

building of the house started 12 years ago and finished 9 years ago. The registrar may

make a rectification order in relation to the construction service of building the house.

35. The factual background to this issue was not in contention. It was as follows:

27 Sep 02 Building approval granted for construction of

‘Manhattan’ apartments

3 Feb 03 New certifier appointed

24 Jul 03 Majority of construction work completed

13 Oct 03 to 28 Oct 03 Certificates of warranty received from trades

relating to completed work

4 Nov 03 Certifier conducts final inspection. Notes

certificates not complete and fire clearance to be

arranged

20 Nov 03 The certifier signs the declaration for the

Certificate of Occupation and Use

25 Nov 03 Certificate of Occupation and Use issues

36. The applicant identified a number of parts of section 35(3) for consideration

within this issue, and submitted that the words ‘may not’ where used are

proscriptive, leaving the Registrar with no discretion. This interpretation was

not opposed by the respondent, and the Tribunal accepts this submission.

37. The beginning and end of the ten year term is a matter of controversy between

the parties. The ten year period ends on “the day the registrar proposes to make

the order” and extends back from that time. The act that caused the

contravention must have happened or ended within that period.

38. The applicant submits that a narrow and literal interpretation must be applied so

that an action done by the licensee must be identified which is associated with

the contravention alleged. If there are a series of acts, then those that occur

within the ten year period are potentially subject to an RO. The respondent and

30

the parties joined advocated a broader approach. They say that ‘act’ can not

only be an individual and simple action but also a composite action consisting

of a number of individual actions. On this interpretation, the construction of a

building by a builder can be considered to be an ‘act’. So that the act that caused

the contravention, being the construction of the building, ended when the

building was completed. Use of ‘ended’ supports the ending of a process which

can be considered not only as a complex continuing process, but also as a large

number of simple but related actions.

39. The respondent specifically relies on part of the Explanatory Memorandum to

the COLA which in relation to clause 35 states as follows:

...Clause 35 enables the registrar to make an order under Clause 37. The

registrar must be satisfied that the person is contravening, or has

contravened, this Act or an operational Act and that it is appropriate to

make a rectification order. However the clause prevents an order from

being given where the registrar is satisfied that the relevant contravention

happened, or was part of something that ended more than 10 years

previously and provides an example. (emphasis added)

40. The Tribunal accepts the submission that it is the ending of the construction of

the building which is ‘the act’ which constitutes the relevant contravention of

the applicant builder in the present circumstances. It also finds that the ‘act that

caused the contravention’ must be interpreted against the context in section 34

and section 35 of a rectification order being made where a licensee has provided

a construction service in contravention of a defined Act. This context requires

consideration of the nature of the construction service that has been provided, so

that in appropriate circumstances, it would be reasonable to regard the

construction service provided by a builder as including all activities going to

make up the construction of a completed building.

41. If the applicant’s contention is correct and the act that caused the contravention

is a single and discrete simple action such as the provision of plumbing to a

bathroom or provision of plumbing to an apartment complex, then for a

complex building there could be multiple section 34 notices and multiple

rectification orders issued. It would be much more practical from this point of

view to issue one rectification notice which relates to all matters.

31

42. This interpretation is supported by the example given at the end of the section

which describes the building service provided by the builder as being the

construction of the house. Thus the ‘act that caused the contravention’ was the

completion of the building in contravention of COLA or an operative Act. The

specifics of that failure are referred to later in these reasons for decision.

43. The date of the ending of the act causing contravention is therefore the date of

completion of the building. In this case, the certifier made a final inspection on

4 November 2003, however there were further fire safety formalities to be

attended to. On 20 November 2003, the certifier signed a declaration for an

application for a ‘certificate of occupation and use’ which was issued on

25 November 2003. It was on that date that the building could be regarded as

having been completed.

44. The date from which the ten year period is to be calculated is ‘the day the

registrar proposes to make the order’. The applicant submitted that this occurred

immediately prior to the Registrar signing the RO. The countervailing argument

is that a rectification order was proposed by the Registrar when he commenced

the process referred to in section 34.

45. If the submission made by the applicant were accepted there would be little

point in the legislature referring to an order that was proposed, it would be

clearer to fix the later point in time as being ‘the time at which the order is

made’. If the time were not the earlier time when investigation is commenced

and appropriate submissions are called for, the process could be disrupted or

even completely frustrated by delay caused by the licensee.

46. The Tribunal is therefore satisfied that the date from which the ten year period

is retrospectively calculated is the day on which the Registrar signed the section

34 notice which was 8 July 2013. The rectification order was therefore made

within the permitted time period.

Section 34 Notice

47. As has been stated in the introduction, this is the review of a decision made by

the Registrar to make a rectification order following the issue of a notice of

32

intention to issue a rectification order. The review is somewhat unusual because

of the preliminary requirement to issue the notice of intent.

48. The applicant argues that the content of that notice constrains the extent of the

rectification order that can be made, and the Tribunal agrees with the general

substance of that submission. Notice of matters potentially requiring

rectification should be given in the section 34 notice in order to allow the

licensee an opportunity to comment and make submissions. However, the extent

and content of the notice and its relationship to the final order made will vary

and will have to be dealt with on a case by case basis.

49. It is appropriate to note the discretionary nature of the powers given to the

Registrar under section 34. Aligned to that consideration is the evident

motivation of the legislature in ensuring disclosure of the problems alleged to be

requiring rectification, and permitting an opportunity to investigate and answer

them. Issues of fairness are prominent, and there is little room for a confined

and legalistic approach to the role of the section 34 notice. It could be expected

that in most cases there would be some submissions made by an entity

following the service of a section 34 notice and that as a result of those

submissions the Registrar may alter his position. A degree of flexibility in the

system could be expected to allow for that process.

50. Having stated that the Tribunal generally agrees with the applicant’s

submissions regarding the section 34 notice, it will be necessary to return to this

topic in relation to some of the individual issues.

Interpretation of the BCA and how it is ‘picked up’ by the BA

51. At paragraph 53 of his written submissions, the applicant submits as follows:

There is no doubt that Section 40A [of the Building Act 1972] imposes an

obligation to carry out building work in accordance with the requirements

of the BCA. However, the section is only contravened if the person does

not have a reasonable excuse.

52. He further submits that the respondent is incorrect in asserting the whole of the

BCA is picked up by sections 37(a) and (b). He submits that those subsections

deal only with the materials used in building work and their methods of use.

“Neither paragraph picks up the majority of the provisions of the BCA, which

33

are not related to building materials but to general matters of building

construction work.” The submission continues as follows:

57.But none of the allegations considered by the Tribunal has anything

to do with particular building materials and their method of use. They

relate to matters such as water penetration and the like, which are not

related to building materials but to general matters of building

construction.

53. The Tribunal does not agree with this submission. It is possible that all

provisions of the BCA are to do with the materials used in building work and

their methods of use so that section 37(a) and (b) in combination do pick up all

of the BCA. Whether the respondent alleges that point is moot because the

respondent at paragraph 4.3 of his written submissions abandons any reliance on

sections 37(a) and (b).

54. However it is clear that section 37 does impose a requirement of compliance

with the BCA when building work is being undertaken as described in the

section. Section 40A reproduced below, creates a criminal offence when there is

non-compliance without reasonable excuse. Whether non-compliance with the

BCA for the purposes of section 40A is defined by the requirements of section

37(a) and (b) is a question which will have to be answered in other proceedings,

since it would only arise in a prosecution for an offence. The terms of section 37

are quite clear and express the obligations of persons engaged in building work

to comply with the provisions of the BCA. Consideration of whether a

rectification order should be made is not to decide whether an offence has been

committed.

55. Finally at paragraph 58, the applicant submits as follows:

Accordingly, the applicant submits that when the Tribunal comes to

consider allegations involving the provisions of the BCA, it can only do so

in the context of the requirements of Section 40A not Section 37.

56. This may become academic because of the respondent’s abandonment of the

first two subsections of section 37, however, the Tribunal cannot agree with that

statement. The provisions of section 37 are clear and whether they are

applicable will become apparent when individual issues are dealt with. As has

been stated previously, the Tribunal is not considering, and has not been asked

to consider, whether the applicant has committed an offence under section 40A.

34

Considerations of whether he had a reasonable excuse for failure to comply with

a provision of the BCA would only be relevant in the context of such a

prosecution. They are extraneous to a consideration of whether a rectification

order should be made under part 4 of COLA.

57. The above determination is relevant to the applicant’s similar submissions in

relation to section 41A of the BA the relevant provisions of which are

reproduced below.

58. Section 41A relates to compliance with section 37. The applicant’s submissions

continue with reference to section 41A which creates an offence relating to non-

compliance in the following terms:

41A Carrying out building work in breach of s 37

(1) Building work (other than maintenance or cleaning of a specialised

system) shall not be begun or carried out except in compliance with

section 37.

59. There is a defence to the offence created for a builder if he had a reasonable

belief that section 37 had been complied with in the terms of sub-section (5) set

out below:

(5) It is a defence to a prosecution against a person other than the owner of a

parcel of land if the person satisfies the court that—

(a) he or she had carried out the building work under a contract

entered into by him or her with another person or at the

request and on the instructions of another person; and

(b) that he or she believed on reasonable grounds that—

(i) a building approval had been issued in relation to the

building work; and

(ii) the work has been carried out in compliance with section

37.

Failure to comply with approved plans

60. The applicant submits that a failure to follow the approved plans should not be

permitted to form the basis for a finding of defective work. The submission is

primarily based on two grounds. The first that there was no reference to at all to

failing to build in accordance with the approved plans in the section 34 notice or

the section 38 order. A sub-argument related to this is ‘is it possible to identify

the approved plans having regard to lapse of time, and some apparent gaps in

35

the plans that are available’. The second was the interaction of section 37(d)

with section 40(1)(a) which authorises a certifier to certify that a building has

been completed substantially in accordance with the approved plans.

61. As to the first, the section 34 notice does refer to the approved plans in the

quotation reproduced at paragraph 15 above.

62. The Tribunal has already referred to a flexible approach to the content of the

section 34 notice, provided areas of alleged defect are sufficiently identified.

This issue will arise in individual items and will be dealt with then.

63. As to the second matter, the section 40(1)(a) issue. Section 37(d) is quite plain

and unambiguous. Section 40(1)(a) does repose some discretion in a certifier,

however, that is a separate issue to the fundamental statement of obligation

contained in section 37(d).

64. To the extent that section 37(d) is an issue, this will be dealt with later in the

context in which it arises.

Individual issues

1) Cracking of external façade

65. The section 34 notice at paragraph 16 refers to ‘Cracking in the External

Facade’. It is referred to as being a breach of Performance Requirement BP1.1

of the BCA. This area of alleged defect in the building is dealt with as a separate

topic in the Diagnostech report of 17 August 2012 included in the T documents

and a copy of which was included with the section 34 notice. The notice refers

to a number of sections of Appendix A to the report which set out individual

instances of cracking. Each instance is accompanied by a photograph.

66. The section 34 notice reference to the performance requirement is referred to

above. The summary at page 93 of the Diagnostech report alleges breach of the

requirements of section 37(a), (b), (c), and (d) of the BA. It also refers to the

performance requirement previously referred to and to section 2.5.2.2,

Differential Movements of the Masonry Structures Code which is Australian

Standard 3700 (AS 3700) and which is called up by section B1.4 of the deemed

to satisfy provisions of the BCA.

36

67. Section 2.5.2.2, Differential Movements Masonry Structures is quoted in the

report as follows.

A masonry member or structure shall be designed to allow movements to

be controlled or isolated so that damage to the masonry, the building, and

its components is avoided….

68. The sections of the Diagnostech report which are referred to in the rectification

order are not grouped together, although some are identified by proximity to

specific units. Each instance is identified by a description and photograph. The

report describes (at paragraph 3.2.1) the defects as follows:

The recorded defects comprise inadequate construction of the building

structure. Inadequate control of building movement has resulted in

uncontrolled cracking of façade elements including masonry, EPS panels,

fibre cement sheeting, render and applied coatings.

Cracks have been recorded as defects in the Defects Schedule only where

they are determined by the author to be significant cracks i.e. in excess of

1mm wide. The façade render elements also exhibited numerous minor

cracks i.e. less than 1mm in width, however these have not been

incorporated in this report.

69. The Tribunal has had the advantage of inspecting the building. A sample of the

cracking defects referred to in the report was inspected and noted.

70. The applicant in his written submissions asserts that the cracking identified is

superficial and limited to affecting the render only.1 It was further suggested

that the cracking should have been attended to when the exterior of the building

was painted by the owners’ corporation for the first time. If there was any need

for the insertion of control joints, this should have been done at the same time.

Presumably it followed that this work should have been done at the owners’

corporation’s expense.

71. There is a report by Alan Tingcombe, a specialist structural engineer, and

director of the engineering firm known as AWT Consulting Engineers. He was

called as an expert witness by the applicant. He had read the Diagnostech report

and had visited and inspected the site on 23 June 2014.

72. Touching the issue of the façade cracking, he was critical of the statements

regarding structural integrity at paragraph 3.2.2 of the Diagnostech report,

1 Paragraph 136ff

37

observing that statements relating to structural integrity were not supported by

any calculations or evidence of that type. He said that all buildings crack

including a building such as the subject premises comprised of steel, concrete

and masonry members. It was in the nature of the structure.

73. He concluded the part of his report which discussed the façade cracking as

follows:

The level of cracking and structural movement is to be expected in a

building of this age and type, especially considering the diversity of the

materials used in and around the structure.

74. In making the rather sweeping statement contained in that sentence, he does not

descend to the level of detail of individual instances referred to in the

Diagnostech report; he does not distinguish between cracks of different widths;

nor does he comment on the issue of and role of control joints inserted to deal

with the inevitable movement in the structure he refers to.

75. The Tribunal notes the views of Mr Tincombe, however is of the view that his

opinion has only limited application due to his lack of reference to control joints

and cracking greater than 1mm in width.

76. Mr Ken Murtagh, an engineer who worked on the construction of the building

and was called to give evidence by the parties joined, said in his statement that

cement based render requires control joints to limit shrinkage cracking.

77. The applicant responded to the section 34 notice by letter of 9 December 2013.

He accompanied this submission with the reports of two qualified experts. The

first of these was Darren Sault, who was a senior structural engineer with ten

years experience as a structural engineer, mostly in Canberra.

78. Amongst other documents, he had been provided with the Diagnotech report.

One of the areas dealt with briefly by Mr Sault in his report was the façade

cracking. He visited the site on two occasions in September 2013. His comment

on this issue on the second page of his report is as follows:

Cracking was primarily noticed to the external façade in the following

areas: To the eastern façade at the interface between concrete slabs and

rendered masonry walls over/under western entry. Cracking at the

parapet level through an area of fascia.

38

These cracks were noted to be façade cracks only, and minor in size (up to

1mm). The extent of this cracking is not considered extensive. It is my

opinion that the cracking is due to building movement and/or settlement,

and should be repaired with a flexible sealant, and monitored for any

further movement or cracking. There is no suggestion that the building

structure is inadequate due to several minor cracks noted in the facade.

79. The Tribunal is unable to accept the opinion of Mr Sault. His description of the

number of locations of cracking indicates that he had not taken into account the

detail contained in the Diagnostech report at the time of his inspection. His

description of all the cracking as being minor and less than 1mm is contrary to

the photographic evidence; the observations of Mr Stephenson, and those of the

Tribunal. He also does not note the absence or otherwise of control joints.

80. The other expert opinion obtained by the applicant was from Martti Honkanen

who was the principal of Mareva Building Consultants with tertiary

architectural qualifications.

81. In dealing with the allegation of cracking in the external façade he said that

minor cracking due to shrinkage and similar causes resulting in hairline cracks

less than 1mm width were not a building fault and could be addressed as part of

routine maintenance. However, he concluded this section of his report as

follows:

I am in agreement with the stated allegation, however, to the extent that

cracking at joints where the substrate structure is able to undergo

differential movement such as at control joints, where control joints

should have been provided but have not been provided, and at junction of

dissimilar materials are building defects and breaches of the BCA

Performance Requirements BP1.1(a)(iii) regarding local damage only.

82. Mr Honkanen provided a second report of 8 September 2014 which became

Exhibit F at the hearing, however this report does not shed further light on the

façade cracking issue.

83. There were many photographs of external cracking tendered in evidence.

Exhibit AV shows a crack measured with an approximately 5 mm width.

84. The Tribunal is therefore of the view that where cracking has occurred of less

than 1mm in width, this does not constitute a defect in the building and is not

considered a breach of the BA or BCA. However, the cracking noted in the

39

Diagnostech report is a breach of section 37(b) & (c) of the BA, the

performance requirements of the BCA alleged, and AS 3700 as alleged.

85. Rectification of the defects listed in the Diagnostech report should be included

in a rectification report. Detailed description of the work to be done should be

left to submissions during the settling of a rectification order.

2) Penetration of water into carpark roof

86. This issue was described in the section 34 notice as ‘penetration of water into

the carpark roof affecting the steel support beams’. Eleven of the sections in the

Diagnostech report were cited as evidence of this problem.

87. It is not alleged by the Registrar that there is a relevant breach relating to the

basement walls, and the Tribunal accepts this submission. Water entry through

the walls was not the subject of notification in the section 34 notice. The roof of

the basement was not treated in the Diagnostech report as an item separate from

the basement walls so it will be necessary to be aware of this distinction during

analysis.

88. The section 34 notice referred to this alleged defect as follows:

2. The penetration of water into the carpark roof affecting the steel support

beams is a breach of the following BCA requirement:

BCA-Part F1 Performance Requirements FP1.3.

A drainage system for the disposal of surface water must:

a) convey surface water to an appropriate outfall; and

b) avoid the entry of water into a building; and

c) avoid water damaging the building.

89. The plans for the building between pages T-Doc 756 and T-Doc 764 show that

the basement extends beyond the footprint of the upper part of the building to

the west, north and east. Generally the plans show that these areas were to have

a concrete slab roof to the basement and that this slab was to have a waterproof

membrane and to be covered by ceramic tiles. An example of this can be seen

on the section plan D-D at T-Doc 762. However, there is an area at the front of

the building where the podium is stepped down and garden is planted over the

podium roof.

40

90. The applicant gave evidence that a torch-on waterproof membrane was applied

to the slab over this stepped down area of the podium of the basement at the

front of the building.2 This was in accordance with the plans which showed a

waterproofing membrane in this area.

91. His evidence appears to conflict with the evidence of the witnesses from Roof

and Balcony Solutions (‘RnB Solutions’) referred to later to the effect that a

paint on membrane was found in this area.

92. The unit owners engaged a waterproofing firm, RnB Solutions, to investigate

and report on water leaking from the podium area. Mr Miller and Mr Parnaby

from that firm inspected the area and a report and some photographs were

admitted into evidence. They found that there was indeed no membrane over the

podium other than in the front garden area where paint on membrane had been

used. Although there was no membrane elsewhere on the top of the podium area

slab, paint on membrane had been applied there to the interface of the walls of

the building and the horizontal surface of the podium. However, they found that

the membrane had not been turned up the wall above paver height so that the

edge was exposed and vulnerable to possible failure. They also found that the

membrane had been terminated on the slab so that the leading edge was exposed

and vulnerable to possible to failure. There was delamination due to moisture.

93. An inspection pit was dug down to the podium outside Unit 2 at the northwest

corner of the building where the slab was stepped down. Mr Miller a principal

of the firm, described taking the inspection pit down to the podium level and

finding on the horizontal surface a protective covering, Corflute, overlying and

adhering to a paint on membrane.3 When a portion of the membrane was lifted,

the substrate underneath was found to be sodden. Photographs included in

Exhibit AW1 were taken in the basement below where the excavation had been

made showing areas of obvious water entry.

94. However in the other podium area, the plans showed ‘ceramic tiles on

waterproofing membrane laid to falls’. The applicant decided to alter this

2 Transcript of Proceedings 14 December 2014 page 585 and T-Documents page 762 3 Transcript of Proceedings 6 May 2015 page 2119

41

specification.4 He added Xypex to the cement which was poured to form the

roof, omitted the membrane and substituted concrete pavers laid on sand for the

ceramic tiles. No provision was made for drainage of the area above that part of

the podium by creation of a fall across it. No approval for this change was

obtained. The available documented landscape plans do show concrete pavers as

opposed to ceramic tiles in the relevant area, however, amendments approved in

the plans do not relate to the changes made by the applicant.

95. The applicant explains why the plans in relation to the terrace decks, also

referred to as the basement podium roof were not complied with in his

evidence.5 He said that he made this change because the pavers had more slip

resistance than a ceramic tile does. He did not say why approval for the change

was not obtained.

96. Although the section 34 notice refers to breach of performance requirement

FP1.3 (disposal of surface water) of the BCA, FP1.4 is also relevant since the

external part of the slab forming the ceiling of the basement is its roof in the

podium area. The entry of water through the external slab is in breach of this

performance requirement. FP1.4 is reproduced below:

BCA-Part F1: Performance Requirements FP1.4:

A roof and external wall (including openings around windows and

doors) must prevent the penetration of water that would cause –

(a) Unhealthy or dangerous conditions, or loss of amenity for

occupants; and

(b) Undue dampness or deterioration of building elements.

97. There is a limitation noted to this provision relating to class 7 buildings.

However this does not apply due to the presence of structural steel beneath the

slab roof and its vulnerability to corrosion.

98. The Diagnostech report notes at paragraph 3.9.1 as follows.

A review of construction plans revealed that a waterproofing membrane

to basement perimeter block walls and ground level terrace decks was a

requirement of the works.

4 Transcript of Proceedings 14 December 2014 page 585 5 Transcript of Proceedings 14 December 2014 page 587

42

……. Diagnostech consider the issue to be non-compliant with the plans

and specifications for the building.

99. The applicant notes the use of ‘avoids’ in FP1.3, and submits that in the context

its use does not exclude the entry of all water into the building. The Tribunal

considers that in the present context the meaning of avoid is ‘prevent’, and that

by its wording, the performance requirement excludes entry of water into the

building by surface water.

100. The applicant submits that there is no breach of FP1.3 because the basement is a

class 7 building. However, inspection of the basement and photographs in

evidence indicate that the concrete slab making up the roof is supported by steel

beams, and water in the area of them is causing corrosion. The Tribunal finds

that a membrane and ceramic tile covering for the external slab was specified in

the plans to prevent intrusion of surface water into the basement in order to

prevent damage to the steel supporting beams. Photographs accompanying the

Diagnostech report show corrosion to steel structural members due to the

presence of water.

101. The section 34 notice alleged that there had been breach of performance

requirement FP1.3 of the BCA but did not mention the plans or FP1.4. It was

not until the hearing that the focus of breach moved to non-compliance with the

approved plans. The plans if complied with would have satisfied FP1.3 and

FP1.4. The issue was the subject of evidence given by the applicant at the

hearing and other of his witnesses and also expert evidence called by the

applicant and the other parties.

102. The respondent submits that the plans specify that the basement roof has to have

“ceramic tiles on waterproof membrane laid to falls”.6 This specification has

not been complied with and is therefore a contravention of section 37(d) of the

BA.

103. In his evidence, Mr Murtagh stated that he would not expect Xypex to be used

as a primary membrane. His expectation was that he would expect a

6 Respondent’s submissions at [21.1]

43

waterproofing membrane to be applied to the top of the slab even if Xypex was

used as an additive to the concrete slab.7

104. The applicant submitted that there was no identified source for the water to be

coming in through the basement roof. Mr Stephenson was asked directly “Is

there water that penetrates through the roof in your view?---Yes.”8 It was

evident that there was cracking in the slab over the podium which provided a

means of entry of water. In a report relating to the corrosion of steel members in

the basement, Dr Jeffrey a chemist called to give evidence on corrosion said at

paragraph 37 of his report which was accompanied by two photos:

Corrosion on the blue channel beam in the basement had been caused by

ingress of water from above as shown by run marks in [photo] 3 and edge

ponding in [photo] 4. Corrosion has not been caused by atmospheric

moisture.

105. Mr Stephenson said that any post construction cracking would render the Xypex

treatment useless.9 He went on to say the following:

A lot of cracking is anticipated in slabs, and it doesn’t necessarily

represent a problem at all. It does represent a problem if it’s an external

slab and you’re relying on Xypex to keep it waterproof.10

106. Ingress of water into the basement beneath the podium area was facilitated by

the change from ceramic tiles. Mr Miller said that ceramic tiles laid to drain to

the perimeter would provide a better water protection mechanism than concrete

pavers.11

107. The Tribunal is satisfied that the Ultrafloor method of construction was likely to

cause cracking in the concrete floor slabs over the podium due to the composite

nature of the slab and differential movement of the building elements. This was

demonstrated by the opinions in expert testimony and observations during

deconstruction of the balconies. Water was observed to be dripping from the

roof area causing efflorescence and a nuisance when dripping onto motor

vehicles parked below. The Tribunal finds that the source of the water was

7 Transcript of Proceedings 5 May 2015 page 1999 8 Transcript of Proceedings 11 March 2015 page 1749 9 Transcript of Proceedings 11 March 2015 page 1748 10 Transcript of Proceedings 11 March 2015 page 1749 11 Transcript of Proceedings 6 May 2015 page 2127

44

surface water passing through the slab due to an absence of an effective

membrane and tiling system to exclude that water which was specified in the

plans. It is also a breach of BCA FP1.3 and FP1.4 since no alternative solution

was formulated.

108. Failure to comply with the plans is a breach of section 37(d) of the BA. It results

in non-compliance with performance requirement FP1.3 and FP1.4 of the BCA,

and forms a basis for the making of a rectification order.

109. There is some existing corrosion of structural steel members in the basement

area. Rust on all steel members under the podium area should be removed, and

the members coated with rust inhibitor. Mr Murtagh referred to the provision of

ground level collars to protect the base of columns.12

These collars should be

provided by way of remediation. Rust should be removed from all structural

steel, which is then to be fully primed as specified by the engineer on T-Doc

783, ‘Structural steelwork finish’.

110. The podium area of the basement roof including the roof to the garbage hopper

area and the front northwest garden area should be exposed and a torch on

membrane provided with suitable flashing where appropriate. This area with the

exception of the under garden area to the west should be covered by ceramic

tiles of a neutral colour agreed to by the parties joined and with a non-slip

surface with falls away from the building. The lintel beam at the entry to the

garbage hopper area should be inspected by an engineer after initial rust

removal. If in the engineer’s opinion the previous rusting has rendered the lintel

structurally unsound (ie. an expected reduction in useful life expectancy of >30

years), it should be replaced. The beam is to be fully primed as referred to

above.

3) Penetration of water into ceilings and walls of habitable units

111. This allegation relates to penetration of water into the building, and has been

treated separately in the section 34 notice and the rectification order. The

respondent in his submissions has combined his submissions in this area with

those of Item 4. The individual components of this item shall be dealt with

individually.

12 Transcript of Proceedings 5 May 2015 page 2007

45

112. Item 86 – This relates to a defect in the ceiling in a common area on the first

level. There is inadequate evidence to indicate that this defect is related to water

entry. The Tribunal makes no finding in relation to it.

113. Items 143 to 145 – These items relate to Unit 19, a unit on the second level with

significant problems due to entry of water. Two other items, 146 and 147, which

relate to Unit 19 are attributed to water entry from the balcony to Unit 26 above.

The Diagnostech report does not attribute the noted problems in Unit 19 noted

as items 143 to 145 to a particular cause, preferring to recommend further

investigation. The Tribunal is not able on the evidence available to make any

specific findings in relation to these items. It seems likely that if leaking from

the balcony above is attended to, these items will be addressed.

114. Item 222 – This is listed as an isolated occurrence described as ‘poorly detailed

service penetration’, evidence of water penetration. This shows an area of a

balcony adjacent to Unit 29. This services penetration will have to be dealt with

if waterproofing of the balcony is carried out.

115. Item 249 – This shows an isolated occurrence of water penetration and further

investigation as to the cause is recommended. The possibility of a roof leak is

referred to. The Tribunal has insufficient information to make any order.

116. No item in this grouping should be included in a rectification order.

4) Penetration of water from balconies into habitable units

117. This issue was described in the section 34 notice as follows:

The penetration of water from the balconies into habitable units is in

breach of the following BCA requirement:



(a) convey surface water to an appropriate outfall; and

(b) avoid the entry of water into a building; and

(c) avoid water damaging the building

118. The balconies on this level, level 3, are in fact roof terraces, since they form the

roof of portion of the unit below. However, for ease of reference they will

continue to be termed ‘balconies’.

46

119. The performance requirement quoted above is not the most appropriate to

describe the entry of water from the balconies into units because the balconies

form the roof of part of the units below. FP1.4 is more appropriate in those

circumstances.

120. The nature of the problem was notified in the section 34 notice and the matter

was extensively canvassed during the hearing. The specification of FP1.3 in the

section 34 notice appears to be an error of no consequence.

121. The unit block is made up of five levels of units. The first level consists of nine

units numbered from 1 to 9, and this is referred to as the ground floor. It is

immediately over the basement which houses resident’s storage, car parking,

and a garbage management area. The second level is known as level 1, and it

has eight units numbered from 10 to 17. It has the same number of units and

same floor plan as the third level above it.

122. Units 18 to 25 are on level 2 (the third level of units). Units 26 to 30 are on level

3, (fourth level). All these units have balconies which are roof terraces. There

are two units on level 4: 31 and 32. All units have balconies. The section 34

notice does not specify the individual units that are the subject of this alleged

defect, however the rectification order that was made by the Registrar does so. It

alleges water entry issues related to Units 17 to 32 inclusive. With the exception

of Unit 17, the units are from level 2 to level 4. Unit 17 has been included by

virtue of a tiling issue which is shared by some of the other units however, this

does not appear to have translated into a water entry issue at this stage. The

defect alleged in Unit 17 has not been the subject of adequate section 34

notification and will not be included in any rectification order.

123. The five units on level 3 are set back from the edge of the lower building

footprint and there are balconies to the edge of the building at which there is a

brick and render parapet. One of the five units has one balcony, two of them

have two balconies, and two of them have three balconies. The balconies are

tiled and there is a mansard roof which forms an ornamental feature at each

corner of the building and at the front and the rear, and with the exception of the

side balconies to the north and south, divides the balconies from each other. The

balconies on level 3 form part of the roof of the units on level 2 immediately

47

below level 3. Each unit on level 2 has some part of its habitable rooms (which

include bedrooms) under part of a balcony on the level above.

124. All units on level 2 and level 3 except for Unit 20 which is under Unit 27, the

balconies of which have been rectified, are reported as having issues arising

from entry of water from the balconies on level three. When the rectification

work was done at Unit 27, the tiles were removed, the bedding removed, the

membrane removed, wall areas and doorways rebuilt, new membrane was

applied and the tiles relaid. This work has been associated with amelioration of

entry of water into units. It was done by contractors for the owners’ corporation.

125. The applicant undertook some remediation work on the balconies of Unit 29.

The nature of this remediation work was described briefly in the evidence.

Evidence from the owner of the unit below indicates that although successful in

stemming the leaks into her unit temporarily, there was a reappearance of water

later.

126. The rectification work that has been done to date has revealed that some of the

waterproofing work that had been carried out on these balconies was defective.

Evidence was given by a witness who supervised the remedial work on Unit 27,

Mr Brett Cawsey. He described a number of faults which contributed to the

entry of water into the adjoining unit and roof void. These permitted water to

penetrate through the slab into the unit below.

127. Mr Cawsey described the installation of a torch on membrane to the balcony

substrate after removal of the previous water proofing membrane; provision of

sand screeds and laying of tiles with adequate expansion joints; removal of the

doors, reinstating wall timbers and cladding; installation of membrane behind

the doors and sills and along the bottom of the walls.

128. The firm that undertook the work on the balconies of Unit 27 were asked by the

managing agent to prepare a quote for the rectification of the balcony areas of

Unit 26. This quote was admitted into evidence as Exhibit AS4. This work was

not carried out, however the listing of work to be done is an indication of the

work required to achieve rectification of each balcony on level 3 and is referred

to later.

48

129. Evidence regarding the remedial work done on level 3 balconies caused the

applicant during the hearing to reassess his approach to this item of the section

34 notice and rectification order that had been made. In their written

submissions, counsel for the applicant submitted the following after briefly

reviewing the available evidence regarding the remedial work:

….the Applicant accepts that the Tribunal has enough evidence from these

sources to find that the waterproofing was not done on these balconies in

accordance with the BCA requirement FP1.4….

Specifically, the Applicant admits that the waterproof membrane was not

properly laid

(a) to the hobs up and under the balcony doors, and

(b) turned up adequately above the level of the skirting tile; and

(c) at the junction between the blueboard and the concrete floor below

the mansard roofs.

130. In making these admissions, the applicant pointed out that the section 34 notice

had said that the leaking from the balconies was alleged to be a breach of

performance requirement FP1.3 which relates to drainage systems. The

applicant said that his admission was for the purposes of FP1.4 which was the

appropriate performance requirement and that the reference to FP1.3 presented a

problem for the Tribunal.

131. The applicant also referred to evidence given in relation to the deconstructed

balconies which related to the discovery of cracks in the concrete slab consistent

with them having been caused by differential movement of the Ultrafloor

components. The applicant submitted that it was unnecessary for the Tribunal to

make any finding in relation to that cracking since the work that would be done

in relation to the insufficiency of installation of the membrane against the walls

and under the floors would result in rectification of that cracking.

132. The Tribunal does not agree with these submissions in their entirety. Firstly as

to the performance requirement specified, FP1.4 describes the situation better,

however FP1.3 is not entirely inappropriate. The section 34 notice gives

adequate notice of the problem and in the view of the Tribunal meets the

provisions of section 34.

49

133. As to the suggestion that the admission should be restricted to findings made by

the Tribunal, the Tribunal does not agree. It is appropriate to identify all causal

contribution to the leaking from the balconies to ensure that the leaking is fully

rectified. It would be inappropriate to assume that rectification of one identified

cause will result in rectification of all other causes. The evidence indicates that

the paint on membrane used, although possibly suitable for other applications,

was not suitable for use on the steel and composite slab construction method

adopted for the building in the area of the level 3 balconies.

134. The applicant also submitted that it was unnecessary for the Tribunal ‘to explore

any other issues to do with leaks in the vicinity of the balconies’. The comments

in the preceding paragraph are appropriate for this submission.

135. The applicant pointed out that the evidence of the finding made on

deconstruction of the two balconies was not put to the applicant’s witnesses. In

those circumstances, the applicant submitted that it would be inappropriate for

the Tribunal to make adverse findings about any of those witnesses on this

issue. The Tribunal generally agrees with this submission.

136. However, having regard to the admissions that have been made and the

applicant’s concession that some rectification work is indicated, it is not

proposed to extensively canvass the evidence regarding this issue. The work

that was done in rectification of the balconies of Unit 27 has already been

referred to. It is however appropriate also to mention an inspection by

Mr Stephenson of work being done by the applicant in rectification of the

balconies of Unit 29.

137. Mr Stephenson prepared a report marked as Exhibit AO1 on water proofing

failure. It is referred to by him at transcript page 1868 as being prepared for

Parchem the supplier of the paint on membrane. A balcony of Unit 29 had

leaked into Unit 24. However, there is a statement of Nancy Pedersen of 30

January 2014, owner of Unit 23. She noticed water leaking into her unit in mid

2007 in the second bedroom through the ceiling. Inspection by the applicant

resulted in rectification works. However in 2009 water started to enter the unit

through a down light in the main bedroom.

50

138. Mr Stephenson visited the site while rectification work was being carried out by

the applicant. At time of the visit, the tiles, bedding, skirting and waterproof

membrane had been removed from the balcony exposing the concrete slab. He

saw sealant joints which had been made when the membrane removal exposed

cracking in the slab. They went perpendicularly from the building wall to the

parapet wall. He thought that thermally induced cracking in the slab had

occurred.

139. Under a heading ‘Possible Cause Discussion’ he noted that the top and bottom

surfaces of the balcony were affected by differential temperature gradients. The

upper tiled surface was exposed to what he described as great thermal

variations. He said: “This may result in differential expansion and contraction

dynamics across the full expanse of the floor slabs leading to cracking.” He

listed a number of factors which may have allowed water to bypass the balcony:

Ineffective perimeter overflashings or overlapping of wall coatings etc.

Poor detailing at membrane turn up with no effective fillets and/or

bond breakers.

Potential detachment of the threshold hob and subsequent failure of the

membrane turn up detail.

Reliance on the waterproofing membrane to span across different

building substrates, ie masonry to fibre cement sheeting.

Ineffective termination at drainage outlets.

Potential shearing of the membrane due to failure to accommodate

movement in the applied tiling.

140. He said that he thought that the membrane selected was not suitable for the task.

There was cracking of the slab and it was required to span different building

material junctions. He thought that a sheet membrane system would have been

more suitable.

141. He expressed his view about the use of paint on membrane on the Ultrafloor

method of construction used.

My experience has shown that you get a pattern of a series of cracking in

Ultrafloor all the time……. So I think that … it’s a poor choice of trying

to waterproof an Ultrafloor slab.13

13 Transcript of Proceedings 11 March 2015 page 1749

51

142. The observations by Mr Stephenson were repeated when his firm was engaged

by the owners corporation to undertake rectification work on Unit 27. The

evidence given by Mr Cawsey is referred to above.

143. The evidence indicates that there are a number of problems with the

waterproofing of the balconies on level 3 requiring rectification. These

problems have resulted in water from the balconies entering the units on level

three and penetrating down through the slab into the units on level 2 below.

144. The problems which have contributed to the water entry issue include the

following:

(a) The unsuitability of a paint on membrane used over a steel and concrete

slab Ultrafloor construction method.

(b) Absence of expansion joints in the tiled surface.

(c) Inadequate waterproofing at intersection of differential substrates.

(d) Absence of a concrete hob specified in the plans.

(e) Inadequate levels of the drainage inlets from the balconies.

(f) Absence of overflashing at the wall and terrace junction.

145. The remediation which has been carried out at Unit 27 has been effective and

acts as a guide to the means to effectively remediate the problems. There is no

reason to believe that the poor construction methods seen at both Units 26 and

27 have not been replicated at all other units on level 3. Water entry problems

do not seem to be experienced in the units on level 4.

146. All balconies on the third level except for Unit 27 will have to be rectified.

Work will need to be done on the balconies on level 3 which permit water to

enter the adjacent Unit. Set out below is a summary of the problems located in

the Diagnostech Report and which will be included in a rectification order.

52

Unit Diagnost

ech

defect

number

L

v

l

Problem Rectification

required

18 133 2 East face, under Unit 26, water

penetration through ceiling

Rectify Balcony

off bed 2 Unit

26. Repair

internal damage

19 146,147 2 South East corner under Unit 26, water

penetration through kitchen, living room

ceiling

Rectify E & S

Balconies Unit

26. Repair

internal damage

21 158 2 West face, under Unit 28, water

penetration bedroom ceiling

Rectify

Balconies off

Unit 28. Repair

internal damage

22 164/5/6 2 West face under Unit 28, water

penetration through living room ceiling

and wall

Rectify

Balconies Unit

28. Repair

internal damage

23 172 3 South West corner, water penetration

through bedroom 1 wall

Rectify

Balconies off

Unit 29. Repair

internal damage

24 179-182 3 North West Corner, water penetration

through bedroom 2 wardrobe

Rectify

Balconies off

Unit 30. Repair

internal damage

25 188/189 3 West face, water penetration through

living room ceiling

Rectify

Balconies off

Unit 30. Repair

internal damage

26 196-204 3 North East corner, water penetration at

floor level in bedroom, kitchen, Mansard

roof space

Rectify

Balconies.

Repair damage

interior unit and

mansard roof

structure

27 208 3 South East corner, water penetration

damage into Mansard roof

Repair damage

in roof space

28 215/7 3 South West corner, water penetration

damage in Bedroom 1, Bedroom 2 &

living room

Rectify

Balconies.

Repair damage

interior unit.

29 219-221, 3 South West corner, water penetration in Rectify

53

Bedroom 1, Bedroom 2, Hall Balconies.

Repair internal

damage.

30 235-239

242/3

3 North West Corner, tiling on balcony,

water penetration in living room, kitchen.

Damage to structures in Mansard roof

Rectify

Balconies.

Repair internal

damage

31 245 253 4 East shower screen. Balcony skirting tiles Not related to

balconies below

32 255,258,

261

4 West tiling on balcony. Not related to

balconies below

147. Evidence was given during the course of the hearing of a proposal by the

owners’ corporation to repair the balconies of Unit 26. To that end a quote was

prepared by Remtech which had repaired the balconies at Unit 27. It was dated

22 February 2011, and was marked at Exhibit AS4. It is an indication of the

work that will be necessary for the rectification of the balconies on level 3. The

work referred to is as follows:

Strip up and dispose of all balcony tiling and thin bedding screeds

Inspect the exposed concrete balcony slabs and carry out any

necessary repairs to the substrate to ensure compatibility and adhesion

bond for the new waterproofing system

Re-detail the drainage inlets to ensure flush mounting with the balcony

floor surface

Install a new high quality torch applied bitumen sheet waterproofing

system

Progressively remove and reinstall balcony doors to enable extension

of the waterproofing system up and behind the sill thresholds

Progressively remove and reconstruct the bases of the masonry walls

and the light weight cladding walls to enable the waterproofing system

to be properly detailed and overflashed

Encapsulate the solid masonry parapet walls with a high build liquid

acrylic membrane

Lay new bedding screeds for drainage falls and retile to match the

existing as close as possible with fully formed expansion joints to the

full perimeter and laterally across the tiling to form approximate

square areas of tiling between joints

148. Rectification of the balconies and internal damage listed above should be

included in a rectification order.

54

149. Listed below are defects included in the rectification order which do not relate

to water penetration from level 3 balconies into habitable units. NL refers to

matters not litigated in the tribunal:

Unit Diagnostech

Defect No.

Defect

17 128 Drummy skirting tiles on balcony

20 149 Balcony, support steelwork, cracked render. Note, under

Unit 27 with rectified balconies

25 184-186 Miscellaneous tiling and cracking problems on balcony

(also water penetration see above)

26 191-195 Miscellaneous cracking etc on balcony, shower screen

leak (also above).

27 209 Balcony wall cap flashing

28 210-214 Wall cap flashing, masonry wall cracking, partition wall

cladding crack, shower screen

29 218, 222,

223, 224,

225, 226/7

Shower screen, poorly detailed service penetration NL,

cracked masonry NL, poor detailing ceramic tiling (will

be rectified with rectification of balcony), door reveal

separation NL, masonry cracking

30 228-234,

240-241

Shower screen, separation of elements NL, steel

corrosion etc on #5 steel, masonry crack NL, poor detail

services entry NL

31 18, 244-252 Corroded steelwork on #5, penetration of services NL,

shower screen, crack bathroom ceiling NL, steel

balustrade, ensuite ceiling water penetration NL

32 19-21, 254,

256/7, 259,

260

Steel balustrade #5, kitchen ceiling NL

150. During the course of the hearing evidence of inspection above the ceilings of

units on level 2 indicated that underslab insulation had possibly not been

installed under the level 3 slab as indicated on the plans. As this had not been

identified as an issue in the section 34 notice, the Tribunal has not furthered

enquiry into that issue and makes no findings in relation to it.

5) Corrosion in the steel framework of the balconies

151. This item is confined to corrosion on the balconies. There is a separate item

which includes reference to corrosion of structural steel materials in the

basement. The section 34 notice referred to this item as follows:

55

The corrosion of the steel framework of the balconies is in breach of the

following BCA requirement:

BCA – Part F1: Performance Requirements FP1.3


(a) Convey surface water to an appropriate outfall; and

(b) Avoid the entry of water into a building; and

(c) Avoid water damaging the building.

152. The quoted performance requirement does not seem to be appropriate for all

instances of observed corrosion. According to Mr Stevenson in the Diagnostech

report, the problem was inadequate coating of the steel and subsequent exposure

to moisture. There were multiple reasons for the steel becoming wet, however

inadequate drainage was not the primary cause of the corrosion. The Tribunal

accepts the evidence of Mr Stephenson that inadequate coating of the steel was

the principal cause which would relate the breach to section 37(c) and (d) of the

BA.

153. Set out below is a table of the documented occurrences of corrosion of steel

elements associated with the balconies. Some of these were in the Diagnostech

report, but not included in the Registrar’s rectification order.

Unit No. Ref

Diagnost

Description Remediation

31 18 Corroded balcony support

steelwork. Inadequate protective

coating

Remove rust.

Fully coat with

Jotaprime

before two

finishing coats

18 25 Corroded balcony support

steelwork. Inadequate protective

coating system.

Remove rust.

Fully coat with

Jotaprime

before two

finishing coats

134 Corroded lintel beam, balcony.

Inadequate protective coating

system.

Remove rust.

Fully coat with

Jotaprime

before two

finishing coats

19 140 Corroded lintel beam. Inadequate

protective coating system

Remove rust.

Fully coat with

Jotaprime

56

before two

finishing coats



Remove rust.

Fully coat with

Jotaprime

before two

finishing coats



Remove rust.

Fully coat with

Jotaprime

before two

finishing coats



Remove rust.

Fully coat with

Jotaprime

before two

finishing coats

32 21 Not in RO, in Rpt Jeffry.

Corroded balcony support

steelwork and balustrade.

Inadequate protective coating.

Remove rust.

Fully coat with

Jotaprime

before two

finishing coats

Repair cracked

tiling.

26 D191 Not in RO, in Rpt Jeffry.

Corroded balcony post.

Inadequate protective coating

system.

Remove rust.

Fully coat with

Jotaprime

before two

finishing coats

D200-203 Corroded support steelwork in

Mansard roof space on balcony

due to water entry

Remove rust.

Fully coat with

Jotaprime

before two

finishing coats

30 D230/1,233, Not in RO. Corroded balustrade,

balcony post. Inadequate

protective coating.

Remove rust.

Fully coat with

Jotaprime

before two

finishing coats

242 Corroded support steelwork in

Mansard roof space on balcony

due to water entry.

Remove rust.

Fully coat with

Jotaprime

before two

finishing coats

57

154. Attention to all the above work should be included in a rectification order. The

steel is to be fully primed as specified by the engineer on T-Docs 783

‘Structural Steelwork Finish’.

6) Failure of waterproofing in the bathroom areas

155. Although this issue was the subject of some evidence, the respondent decided

not to pursue it. The parties joined indicated that the owners had mostly

attended to rectification of issues themselves, and that only one bathroom may

the subject of an order.

156. However, apparently after some discussion the bathroom issue was not pursued

by any of the parties. The Tribunal does not consider that the state of the

evidence together with the approach of the parties to the issue justifies further

examination of it.

7) Defective capping of parapet

157. This issue was described in the section 34 notice as follows:

The defective capping of the parapet is a breach of the following BCA

requirement.


A roof and external wall (including openings around windows and doors)

must prevent the penetration of water that would cause:

(a) Unhealthy or dangerous conditions, or loss of amenity for

occupants; and

(b) Undue dampness or deterioration of building elements.

158. This allegation does not specify the location of the capping, but the design of

the building makes it clear that the parapet referred to is the parapet which

forms the outer border of the level 3 balconies.

159. Particulars of this allegation in the rectification order made by the Registrar

were sought (together with others) by the applicant from the respondent on

29 May 2014. Question 21a asked for details of the breach alleged of

performance requirement FP1.4. The answer was to the effect that the defective

nature of the application of the capping would permit water penetration

contributing to water entry from the balcony areas of level 3 to the units at that

level and the level below.

58

160. A further question relating to section 37 of the BA was answered indicating that

the parapets had not been constructed in a proper and skillful way.

161. The Diagnostech report, Exhibit AP, included a number of photographs cited as

instances of defective attachment of the parapet capping. Instances of defective

capping were confined to the balconies of Units 26, 27 and 28. The photographs

showed locations where joins in the capping were no longer providing a

waterproof union.

162. The section 34 notice refers to the capping generically, however the area of the

building to which this issue could apply is relatively confined, (level 3

balconies), and the nature of the problem can be identified by inspection of the

balconies and examination of the Diagnostech report which accompanied the

notice as attachment ‘A’. The Tribunal considers that notice of this defect and

the nature of it has been sufficient in the circumstances.

163. The applicant submits that the capping allegation is ‘tied’ to the BCA

performance requirements, and the respondent is purporting to expand the

allegation by including an allegation of contravention of section 37(c) of the

BA. The applicant submits this is impermissible. The Tribunal does not agree.

Adequate notice has been given of the physical defect alleged it is not necessary

to have strictly pleaded the statutory basis for the breach in the section 34

notice.

164. The applicant relied on the evidence of Mr Honkanen a building expert called

by the applicant. His evidence was to the effect that there may have been better

ways to attach the capping, however, the way in which it had been attached was

acceptable.

165. Mr Stephenson gave evidence and a number of documents were tendered during

the course of that evidence which became Exhibits AP1 to 6 and AQ. He said

that it was not good practice to attach the capping through the top surface since

it provided a point of entry for water and attachment by that means would not

allow for the expansion and contraction of the metal which could be expected in

that location. He said that lack of provision for expansion and contraction had

59

led to opening of joins in the capping sections which would be contributing to

the known water penetration issues.

166. The Tribunal has noted the separation of the joins in the metal both in the

photographs which form part of the Diagnostech report and observations during

inspections of the building. Insofar as there is a conflict in the evidence of

Messrs Honkanen and Stephenson, the Tribunal prefers and accepts that of

Mr Stephenson since his views are supported by the observations of the

Tribunal referred to.

167. Defects in the capping application have been identified on three of five

balconies on level 3. In the circumstances it is justifiable to assume that

although the fixing of the capping was by the same method in the unaffected

units, local conditions have resulted in problems associated with the fixing

method not having manifested. Thus the capping in the affected units should be

rectified in the manner suggested by Mr Stephenson, leaving the unaffected

units as is.

Gaps and Defects in the roof

168. This issue is identified in the section 34 notice as follows:

The gaps and defects in the roof are a breach of the following BCA

requirement:


A roof and external wall etc…

169. In the rectification order made by the Registrar, items 98, 99, 100, 101 and 102

were referred to. During the course of the hearing, the parties joined tendered a

presentation of photographs which became Exhibit AK. This included

photographs of defects in the mansard roofs of Units 26 and 30. There was

evidence that patching material shown in the photographs and some silicone

sealant which could not be seen had been applied by residents or the owners’

corporation in order to prevent the entry of water.

170. The applicant opposed the making of an order in relation to the roof on a

number of bases.

171. One was that it had not been demonstrated that any defect in the roof had

contributed to the water leaking into the units on the second and third levels. It

60

was noted in the submission that the defects were referred to in the Diagnostech

report as being a ‘potential’ cause of water ingress.

172. The Tribunal considers that if original construction work is shown to be

defective because of breach of section 37(c) of the BA, then the requirements of

section 34 and section 35 of COLA are met. It is not necessary that the work

which contravenes section 37 of the BA having not been done in a proper and

workmanlike manner should necessarily have resulted in damage. Absence of

damage would be a consideration where a discretionary decision was being

made by the Registrar. It is a reasonable inference from the evidence that the

leaking alleged has contributed to the water entry problems, particularly those

associated with the Mansard roofs.

173. Another was that a beach of the BCA had not been identified by Mr Stephenson.

Each instance cited by Mr Stephenson involves some degree of criticism by him

of the workmanship related to the defect indicating a breach of section 37(c) of

the BA. Again this is sufficient for the purposes of section 34 and section 35.

174. The defects involved in this issue are relatively minor and can be relatively

easily attended to. They should include the area identified by the parties joined

in Exhibit AK. All matters referred to above should be the subject of a

rectification order.

Conclusion and directions

175. The rectification order made by the Registrar will be set aside and another

substituted. The matter will be listed for settling a rectification order. The

respondent should circulate a draft order to the parties not later than two weeks

prior to the listed hearing date. The other parties should circulate suggested

amendments not later than five days prior to the hearing date.

……signed……………..

President W. G Stefaniak AM RFD


61

HEARING DETAILS

FILE NUMBER: AT 99/2013

PARTIES, APPLICANT: Michael Koundouris

PARTIES, RESPONDENT: Construction Occupations Registrar

PARTIES, 1st PARTY JOINED Mr R Farrell

PARTIES, 2nd

PARTY JOINED Mr E Purrer

PARTIES, 3rd

PARTY JOINED The Owners – Units Plan 2340

COUNSEL APPEARING, APPLICANT Mr Erskine SC, Ms Katavic

COUNSEL APPEARING, RESPONDENT Mr Clynes, Mr Buckland

SOLICITORS FOR APPLICANT Trinity Law

SOLICITORS FOR RESPONDENT ACT Government Solicitor

RESPRESENTING PARTIES JOINED Mr R Farrell, Mr E Purrer

TRIBUNAL MEMBERS: Mr W.G Stefaniak AM – Appeal

President, Mr G. Lunney SC –

Senior Member, Mr G. Trickett –

Senior Member

DATES OF HEARING: 8-11 December 2014, 16-17

December 2014, 3-6 February 2015,

10-12 March 2015, 5-8 May 2015,

28-30 July 2015

62

SCHEDULE 1

Building Act 1972

37 Requirements for carrying out building work

Building work shall not be carried out otherwise than in accordance with

the following requirements:

(a) the materials used in the building work shall conform to the standards

for those materials set out in the building code;

(b) the methods of use of those materials in the building work shall

conform to the acceptable methods of use set out in the building

code;

(c) the building work shall be carried out in a proper and skilful way;

(d) the building work shall be carried out in accordance with the

approved plans;

(e) if an owner-builder’s licence has not been granted in relation to the

building work—the building work shall be carried out by a person

who is the holder of a builder’s licence of a class that authorises the

carrying out of the building work;

(f) if an owner-builder’s licence has been granted in relation to the

building work—the building work will be carried out by the person

to whom the licence has been granted;

(g) the licensee in charge of the building work shall take—

(i) all the safety precautions specified in or with the application for

the building approval; and

(ii) any other safety precautions that a certifier or a building

inspector may from time to time specify.

40A Compliance with building code

A person shall not, without reasonable excuse, carry out building work

except in accordance with the building code.

Maximum penalty: 50 penalty units.

Construction Occupations (Licensing) Act 2004

34 Intention to make rectification order

(1) This section applies if the registrar believes on reasonable grounds that—

(a) a licensee or former licensee (the entity) has provided a construction

service otherwise than in accordance with this Act or an operational

Act; and

(b) it may be appropriate to make a rectification order.

Examples of licensee or former licensee

1 a licensed builder does building work

2 a drainer who was licensed, does sanitary drainage work while unlicensed

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3 a licensed gasfitter does gasfitting work and then becomes unlicensed

Note 1 If deciding under this section whether it may be appropriate to make a

rectification order, the registrar must consider the considerations mentioned in s

36.

Note 2 An example is part of the Act, is not exhaustive and may extend, but does not

limit, the meaning of the provision in which it appears (see Legislation Act,

s 126 and s 132).

(2) The registrar may give the entity, and the land owner in relation to whose

land the construction service was provided, a written notice that—

(a) gives details of the rectification order that may be made; and

(b) explains why the registrar intends to make the order; and

(c) invites submissions about the making of the order within the time

stated in the notice that is not less than 5 working days after the day

the entity or land owner receives the notice; and

(d) states that—

(i) the registrar will not make a rectification order if the registrar is

not satisfied that it is appropriate to make a rectification order in

relation to the entity; and

(ii) if the registrar does not make a rectification order the Territory

may authorise someone else to do the things stated in this

notice, and the entity will have to pay for the things to be done.

35 When rectification order may be made

(1) This section applies if—

(a) the registrar has given an entity notice under section 34; and

(b) the entity provided the construction service, or part of the

construction service, to which the notice relates; and

(c) after considering any submissions made within the time mentioned in

the notice, the registrar is satisfied—

(i) the entity is contravening, or has contravened, this Act or an

operational Act; and

(ii) it is appropriate to make a rectification order in relation to the

entity.

Note 1 If deciding under this section whether it is appropriate to make a rectification

order, the registrar must consider the considerations mentioned in s 36.

Note 2 A reference to an Act includes a reference to the statutory instruments made or

in force under the Act, including any regulation (see Legislation Act, s 104).

(2) The registrar may make an order under section 38 (Rectification orders) in

relation to the entity.

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(3) However, the registrar may not make an order under section 38 in relation

to the entity if a submission is made that satisfies the registrar that the act

that caused the contravention happened, or ended, more than 10 years

before the day the registrar proposes to make the order.

Example of contravention

A builder built a house without a building approval. The registrar is satisfied that the

building of the house started 12 years ago and finished 9 years ago. The registrar may

make a rectification order in relation to the construction service of building the house.

Note An example is part of the Act, is not exhaustive and may extend, but does not

limit, the meaning of the provision in which it appears (see Legislation Act, s

126 and s 132).

36 Considerations for deciding under s 34 and s 35

(1) In deciding whether it is, or may be, appropriate to make a rectification

order in relation to an entity that is contravening, or has or may have

contravened, this Act, the registrar must consider the following:

(a) any injury, loss or damage caused, or that could have been caused, by

the contravention;

(b) if a rectification order is proposed—how the proposed order may

affect people affected by the contravention.

Examples of effect of contravention, including injury, loss and damage

1 reduction in safety, reliability, durability, soundness, functionality, accessibility,

serviceability, service life, usability, usefulness, amenity, aesthetic quality, value or

efficiency of thing affected by contravention

2 adverse affect on health of user of thing affected by contravention

Note An example is part of the Act, is not exhaustive and may extend, but does not limit,

the meaning of the provision in which it appears (see Legislation Act, s 126 and s

132).

(2) The registrar may consider anything else that is relevant.

(3) However, the registrar need not consider whether the registrar, planning

and land authority, a certifier or other entity has—

(a) given a certificate, or approval under—

(i) this Act or an operational Act in relation to the construction

service; or

(ii) the Planning and Development Act 2007 in relation to the place

where, or the territory lease under which, the construction

service was provided; or

(b) otherwise endorsed the construction service under this Act or an

operational Act.

Building Code of Australia FP1.3 A drainage system for the disposal of surface water must- (a) convey surface water

to an appropriate outfall; and (b) avoid the entry of water into a building; and (c)

avoid water damaging the building.

FP1.4 A roof and external wall (including openings around windows and doors) must

prevent the penetration of water that could cause- (a) unhealthy or dangerous

conditions, or loss of amenity for occupants; and (b) undue dampness or

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deterioration of building elements. Limitation: (a) (b) , or (c) an or . FP1.4 does

not apply toa Class 7 or 8 building where in the particular case there is no

necessity for compliance; or a garage, tool shed, sanitary compartment the like,

forming part of a building used for other purposes; or open spectator stand open-

deck carpark