Question: Our 4 year old building is full of defects. The committee has taken the builder, who is also a lot owner in our building, to QBCC. The builder took a fine and cancelled his builder license rather than fix the building. We’ve found he is now operating under a new ABN. What are our rights?
Our building is 4 years old. The committee has already taken the builder to QBCC regarding fire, waterproofing and roofing defects and the builder chose to fix some of the DTRs and then opted to take the $2500 fine and 4 demerit points rather than address the $100k plus costs associated with rectifying the remaining issues. The builder and developer still own 6 of the 24 units, and successfully voted down a motion at our AGM to take the builder to QCAT to recoup the $40K spent getting our building compliant.
We now have drain pipes falling away from the building and failed waterproofing which has allowed water to penetrate the concrete slab at the entrance, causing the slab to erode significantly.
When we approached the builder regarding these matters, he sent an email saying he was retiring from the family business and cancelling his builder’s licence. Several owners are now experiencing leaks in their units and going through QBCC again. The committee has recently discovered the builder is now trading under a new name and ABN and has reactivated his builder’s licence.
What are our legal options?
Answer: Bodies corporate do have rights of subrogation into the developer’s shoes with contractual rights against contractors, but that starts with the contractual documentation.
The first is that a body corporate has a statutory duty to keep common property in good condition. That means defects must be addressed and not left to wait until court proceedings or the QBCC might produce an outcome. And dare I say it, if the developer still owns a quarter of the lots through ownership, then dealing with that now at least means they get to share in the costs as an owner.
The second is control of the general meeting. The answer is way more complex than would serve here, and it really is looking at whether those votes can be overturned or ignored so the body corporate can do what it should.
Then you need to look at the rights of the body corporate to recover from someone and that then sounds a bit messier, but bodies corporate do have rights of subrogation into the developer’s shoes with contractual rights against contractors, but that starts with the contractual documentation. But you have to start with the first two. Then look at this.
This post appears in the February 2022 edition of The QLD Strata Magazine.
Frank Higginson
Hynes Legal
E: frank.higginson@hyneslegal.com.au
P: 07 3193 0500
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