Navigating Building Law Reform: Opportunities for Architects
The building law reforms underway in various Australian states and territories will transform the legal landscape for architects and other building practitioners. We expect these reforms will be a positive development for architects, engineers and design practitioners because:
the tasks and duties they impose on design practitioners are aligned with those that quality design practitioners undertook before the reforms; and
they give design practitioners greater commercial leverage in their dealings with developers and builders, and enhance their ability to provide for the proper performance of such tasks and duties in their engagement terms.
The new statutory duty of care to avoid pure economic loss arising from building defects, enacted by the NSW Parliament to fill the gap created by court-made negligence law, is a welcome development for owners corporations and for subsequent owners of commercial buildings. But its impact on the application of proportionate liability schemes, as declared by the High Court in its Pafburn decision, won’t be welcomed by architects or their professional indemnity insurers.
We expect developers, builders, architects and others to whom this non-delegable statutory duty applies will seek indemnities from those to whom they subcontract. Those asked to provide such indemnities will wish to limit them by reference to their fee and their proportionate share of responsibility for the loss.
Below are the slides that I presented on these key reforms at a recent seminar for architects. Please contact Owen if you’d like to discuss how to adjust your engagement terms to take full advantage of these reforms.
