VIC: Q&A How to fix strata building defects

This VIC question is about the next steps to take after a builder refuses to repair a major strata building defect.

Table of Contents:

• QUESTION: Our building has a range of defects. How do committee members know which defects to prioritise based on their severity and potential impact on the safety and functionality of the building?
• QUESTION: How can I be sold an apartment when the developer must know it has significant heat issues due to its design?
• QUESTION: An external wall in our building has deteriorated, causing water ingress. Is the owners corporation responsible for maintaining and repairing common external walls?
• QUESTION: After cladding rectification work was done on our balcony, our AC no longer works and we’ve noted other damage. The OC will not take any action. What do we do now?
• QUESTION: Does Sedgwick provide strata managers with a templated scope of works or support or documents to ensure the insurers are put at ease?
• QUESTION: One wall in my unit has developed substantial cracks over the past 10 years. The owners corporation has investigated the cause but the insurance company has denied the claim. Is the OC responsible to repair any damage?
• QUESTION: An owner has water on the window sill. It’s difficult to assess where the water is coming from. How do we find the source of the leak?

Question: Our building has a range of defects. How do committee members know which defects to prioritise based on their severity and potential impact on the safety and functionality of the building?

Answer: A building consultant can assist in identifying defects and advising of risks.

It is always best to get an expert involved to assist in this process, as it can be complex.

A building consultant can assist to not only identify defects but also advise of risks associated with the defect to allow prioritisation and a plan. Owners should not attempt to navigate this area without advice as there are many considerations.

Bruce McKenzie
Sedgwick
E: bruce.mckenzie@au.sedgwick.com
P: 1300 735 720

This post appears in Strata News #715.

Question: How can I be sold an apartment when the developer must know it has significant heat issues due to its design?

I bought a North facing apartment. Over Summer, the temperature of the window on a 29 degree day (with double blinds closed) measured 45 degrees.

The developer chose not to install awnings, and I had to cite the sustainability changes in the Act before the owners corporation approved my request for thermal film. External awnings aren’t something the owners corporation is interested in. Nor will they do a heat audit of the building.

I’m roasting, resentful I need to pay for the film, and worried for my neighbours. Can I ask the owners corporation to pay for thermal film and install the film on all North facing units?

How can I be sold an apartment when the developer must know it has such significant heat issues due to its design?

Answer: Who has ownership over the windows?

There are several things to consider when approaching this issue. The first is who has ownership over the windows? Depending on your plan of subdivision, it may either be private or common property or could be shared.

Second, is whether this issue is shared amongst your neighbours as you have noted in your question. I’d encourage you to reach out to them or raise it at the next Annual General Meeting. This will assist you in demonstrating that it is a shared issue which should be addressed by the owners corporation. If the owners corporation is unwilling to assist, and you wish to pursue the matter, I’d encourage you to seek legal advice from an owners corporation specialist lawyer. They may recommend you engage a building specialist to advise on whether the issue is a defect that can be pursued.

We note additionally that if you have purchased a new property (under 10 years old), you can raise the issue with the builder of the property and ask them to address it as a defect. Should they refuse, you may need to engage a building specialist to prove the issue is a defect.

Alex Smale
Melbourne Owners Corporation Services
alex@mocs.com.au
P: 03 9818 2488

This post appears in the July 2024 edition of The VIC Strata Magazine.

Question: An external wall in our building has deteriorated, causing water ingress. Is the owners corporation responsible for maintaining and repairing common external walls?

The external walls and facade on one side of the units in our owners corporation have suffered from years of neglect and are now rotting and causing water ingress. The damage affects approximately 20% of lots due to the design of the complex. Different units have different levels of exposure (and different finishes) and likely slightly varying remediation/rectification requirements.

The owners corporation has been aware of the issue for years. Over the past two years, the committee argued that responsibility for managing repair and costs lies with individual lot owners. Is the owners corporation responsible for maintaining and repairing common external walls?

Answer: Whether the owners corporation is required to maintain and repair the external walls will depend on whether it is common property or private lot property.

Whether the owners corporation is required to maintain and repair the external walls will depend on whether it is common property or private lot property. If you are unsure you should obtain advice on the interpretation of the plan of subdivision. If the walls are common property, the owners corporation has the legal obligation under section 46 of the Owners Corporations Act 2006. The obligation lies with the lot owners if they are private lot property. Notwithstanding, the owners corporation may be liable under section 46. It will need to determine whether it should strike levies to pay for the works under the benefit principle or according to lot liability.

If the owners corporation refuses to maintain and repair common property, lot owners should consider changing the committee to a committee that will take action or, failing majority support, seek appropriate orders from VCAT.

Phillip Leaman
Tisher Liner FC Law
E: ocenquiry@tlfc.com.au
P: 03 8600 9370

This post appears in the May 2024 edition of The VIC Strata Magazine.

Question: After cladding rectification work was done on our balcony, our AC no longer works and we’ve noted other damage. The OC will not take any action. What do we do now?

I own a Docklands apartment on the 11th floor of the building. Two months ago, the Owners Corporation organised balcony cladding rectification works. While the work was being done, the balcony was inaccessible and our air-conditioning unit installed on our balcony was turned off. Even though the AC is over 15 years old, it has been regularly serviced and its compressor motor was changed 2 years ago. Before the balcony cladding works commenced, the contractors carried out pre-inspection testing and found the AC working. 

When the balcony cladding works were finished and we were handed back the balcony access, we found various issues. The AC is no longer working, the AC insulation pipe is missing, there are now multiple cracks on the balcony floor and a nut is missing from the partition glass.

We reported these issues to the Owners Corporation, but nothing has been done. We have had no communication about the dispute resolution process. What do we do now?

Answer: Approaching the builder directly might be a quicker option provided that there is enough evidence stating that the cause is from their works.

Since the builder was engaged by the Owners Corporation to carry out the cladding work, the onus is on the Owners Corporation manager to inform the builder of your concerns and request the builder to liaise with the lot owner to assess the situation and advise.

If the owner is not receiving a timely response from the manager, which seems to be the case here, then approaching the builder directly might be a quicker option provided that there is enough evidence stating that the cause is from their works. This might mean the lot owner engaging an Air-Con technician to provide an assessment/report on the condition of the Unit and what may have caused the unit to fail. The same process should apply to other damages incurred to the balcony and most importantly, the glass partition referred to in the concern, which might need to have the missing screws refitted from an OH&S requirement.

The other option would be to lodge a formal complaint with the Strata Manager by following the Consumer Affairs guidelines. Failing that, lodging the dispute at VCAT might be your last resort to resolve the issue.

Jodie Moloney
MBCM Strata Specialists
E: administration@mbcm.com.au
P: 1300 777 276

This post appears in the July 2022 edition of The VIC Strata Magazine.

Question: Does Sedgwick provide strata managers with a templated scope of works or support or documents to ensure the insurers are put at ease?

Answer: We use a fairly standardised layout. Most of the insurers have all seen it before.

Bruce McKenzie, Sedgwick:

As a business, how Sedgwick prepares our scope of work are relatively typical. Most of them are similar in layout and what we’re doing is providing explicit advice to a contractor on what we want them to do, right through for every stage of the work.

If we talk about cladding and most defects, when we look at the problem of cladding or a particular defect, I can assure you, when you write a scope of work, it’s not a matter of just removing that thing and replacing it. There’s always subsequent work that happens and part of what we try to do is to unpack all of that work.

If it is in a unit where we may end up having to strip plasterboard off, this might mean carpet replacement, it might mean fixing the gardens outside, because the scaffolds going to damage it. It’s all of those knock on things that we try to make sure the builder includes. The benefit of that is to try and alleviate surprise costs and variations later on, where owners certainly don’t appreciate a builder or anybody else, for that matter, turning around saying, it looks like we’ve got another $50,000 worth of cost because we didn’t realise that we had to cut up a section of driveway to do what we did.

Part of what we do is take a fairly deep dive into the whole methodology of ‘How is this going to actually occur?’ We look into things when we start to consider contractors such as, ‘How are they going to gain access to that side of the building? Are they expecting to completely block the driveway and access so no one can park for three months?’, Or ‘What considerations have they made?’, Because we work with live buildings all the time, we know the questions to ask and we already know what’s acceptable and not acceptable to most owners corporation so we will dive into that deeply and make sure a builder is realistic in the way they’re going to approach it to mitigate or reduce the impact to the occupants, particularly when they’re going to be occupying the building. That’s part of the service we provide.

Tho answer the question more directly. Yes, we use a fairly standardised layout. Most of the insurers have all seen it before. It often goes to insurance builders as well if it’s another kind of loss that we’re involved with. Floods is probably a really big one at the moment.

George Endacott:

The scope of work is a very important document. It effectively provides that conduit of written communication between the principle contract or who’s going to undertake that work, and who’s providing or where that instruction has come from. That line of communication needs to be very clear. If there’s any dispute, you’ve got that source of truth to go back to. By the time you have a signed off scope of works, everyone is on the same wavelength. Everyone knows what the expectation is, and you can use that as your conduit for proceeding.

I can’t emphasise enough that the scope of work is an integral document in the whole process. Obviously, as project managers, we would use that then as a cornerstone for how we will then support on behalf of clients the programme delivery of that project.

Bruce McKenzie
Sedgwick
E: bruce.mckenzie@au.sedgwick.com
P: 1300 735 720

George Endacott
Sedgwick
E: George.Endacott@au.sedgwick.com
P: 1300 735 720

This post appears in the May 2022 edition of The VIC Strata Magazine.

Question: One wall in my unit has developed substantial cracks over the past 10 years. The owners corporation has investigated the cause but the insurance company has denied the claim. Is the OC responsible to repair any damage?

I own a unit in Victoria that has, over the past 10 years, developed cracks in the northern wall.

The owners corporation investigated the stormwater drains and found them to be blocked and overflowing. This has been repaired. They submitted a claim to the insurance company who sent out a structural engineer to investigate the problem. He did a review of the levels of the building and came back with an opinion that the wall had sunk due to the nature of the soil. He did not carry out a soil test as he said he was not authorised to do this and described the damage as “slight”.

The insurance company subsequently rejected the claim (which was for damage caused by water escaping from the stormwater drains over a period of 16 years, causing subsidence).

Is the owners corporation responsible for remedial action to repair the cracks in the outside walls even though the insurance claim has been rejected? Can I ask the owners corporation to pay for a second independent engineer’s investigative report regarding the cause of the damage?

Answer: If the cracks deteriorate further since the insurer’s engineers report, I would strongly recommend the Owners Corporations to get their own independent engineer’s investigation.

It’s difficult to know how to answer this one without looking at the insurer’s engineering report, which I assume wasn’t provided to the Owners Corporation. However, these are the guidelines taken from Guide to Standards and Tolerances 2015.

Concrete slabs: If the damage is ‘slight’ (refer to the table below) they need to be monitored for 12 months, so no sudden repairs are required.

Walls: If the damage is category 2 – Slight <5mm (refer to the table below) they need to be monitored for 12 months, so again, no sudden repairs are required.

Without looking at any drawings or the Plan of Subdivision (POS), the Owners Corporation should be responsible for periodic inspection and maintenance if the stormwater assets (drains) belong to the owners corporation.

The initial engineer should have recorded the cracks so OC can monitor them for the next 12 months. If they get bigger, then the OC can undertake a further structural inspection with a soil test.

It is the Owners Corporation’s responsibility to attend to all maintenance as per the Owners Corporation Act. All remedial action to repair the cracks in the outside walls falls with Owners Corporations.

If the cracks have deteriorated further since the insurer’s engineers report, I would strongly recommend the Owners Corporations to get their own independent engineer’s investigation done as soon as possible for peace of mind.

Paul Cummaudo
Roscon Group
E: info@roscon.com
P: 1800 767 266

This post appears in the December 2021 edition of The VIC Strata Magazine.

Question: An owner has water on the window sill. It’s difficult to assess where the water is coming from. How do we find the source of the leak?

The owner of an apartment in a complex of 12 apartments in a classic 3 storey cream brick block of apartments in Hawthorn Victoria has water on the window sill of her apartment. The external aluminium window frames have been sealed by a plumber and it is difficult to assess where the water is coming from.

1. Is the Owners Corporation responsible to find the source of the leak or should it be the owner?
2. Who is the appropriate trade to inspect the building and find the source of the leak?

Answer: Contact a building inspection or remedial works company that uses thermography or Infrared Cameras to detect the presence of moisture and try and track the source.

If the water penetration is on the interior sill it is reasonable to assume it has entered through the window framing structure.

If there is no sign of dampness in the wall or bulkhead above the windows this will tend to confirm the source.

An initial approach could be contacting a building inspection or remedial works company that uses thermography or Infrared Cameras to detect the presence of moisture and try and track the source.

If it is only one apartment affected this is probably the best approach.

If there are multiple apartments affected it will either be a problem with the glazing framing or water ingress through flashings or joint seals on the exterior of the building.

In this case, if it is a widespread problem then a façade condition inspection or assessment by the Owners Corporation is the next option.

Again the Owners Corporation could approach a company that deals in inspections or remedial works.

If it is particularly concerning they may consider involving a structural engineering firm or consultant to diagnose and recommend a rectification process

Stephen Thornton
VOLTIN
E: Steve@voltin.com.au
P: 1800 865 846

This post appears in Strata News #523.

Read Next:

• VIC: Q&A Damage caused by a water leak from balcony above
• VIC: Q&A What’s Common Property and Who’s Responsible for Repairs?

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