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© Copyright 2011 Teys Lawyers www.teyslawyers.com.au
Serious Building Defects And Disputes -‐ And How To Avoid Them
© Copyright 2011 Teys Lawyers www.teyslawyers.com.au
Webinar, 3 November 2011
© Copyright 2011 Teys Lawyers www.teyslawyers.com.au
Responsibility
• Who’s responsible?
• Two causes of defects
1. Design
2. Workmanship
© Copyright 2011 Teys Lawyers www.teyslawyers.com.au
Why Bother?
• DeterminaMon of proper defendant
• DeterminaMon of cause of acMon:
– Statutory warranMes
– Negligence
© Copyright 2011 Teys Lawyers www.teyslawyers.com.au
Case study -‐ Balcony Leaks
• Most common defect
• Youtube – ‘Building Blox’ video by Ross Taylor
• Demonstrates tension between proper design and workmanship
Why Balconies Leak
© Copyright 2011 Teys Lawyers www.teyslawyers.com.au
New Approach by TEYS Lawyers
Early SeTlement Framework
Engage with the builder as an
equal
Facilitate open, full and frank
without prejudice
discussion with builder
Assist builder in finding a soluMon
© Copyright 2011 Teys Lawyers www.teyslawyers.com.au
New Approach by TEYS Lawyers (cont)
PracMcal soluMon rather than ‘Rolls Royce’ version
from ambit claim
Legal proceedings are an implied (rather than explicit) threat to incenMvize builder
to engage in process
Once agreement is reached, it is recorded in a deed (avoiding liMgaMon)
© Copyright 2011 Teys Lawyers www.teyslawyers.com.au
Steps to New Approach
Builder returns to site and does minor work armed with a
silicon gun
Engagement of expert by TEYS
Lawyers
Expert then makes iniMal contact with
builder
SensiMvity to large expert reports
Psychology of builders
Tone of discussions Role of TEYS Lawyers
Prototype, Agreement and
Deed
© Copyright 2011 Teys Lawyers www.teyslawyers.com.au
Case Study 1
OC of over 200 units
Significant water penetraMon issues
OC independently retained expert who described defect but not cause
Builder rejected content of report ciMng ‘wind-‐driven’ rain as cause
OC wasted a year in the process
OC approached TEYS Lawyers for leTer of demand
TEYS Lawyers advised need to determine defect (not describe it)
Consultant engaged and invited builder to observe tesMng. RecMficaMon work idenMfied and esMmated at >$5m
Builder conceded responsibility and agreed to recMfy
Outcome achieved in 6 months – less than $10k in legal fees billed to date
Background Outcome
© Copyright 2011 Teys Lawyers www.teyslawyers.com.au
Case Study 2
OC of over 100 units
Significant defects affecMng many units (cost esMmate circa $10m)
Legal proceedings commenced by another law firm – claimed against HOW policy
Builder aTempted recMficaMon, was unable and engaged lawyer to defend claim
OC spent a year in the process
OC approached TEYS Lawyers
Consultant engaged and invited builder to observe tesMng. RecMficaMon categorised as type and cause
Prototypes for recMficaMon devised and agreed with builder
TEYS Lawyers disconMnued unnecessary proceedings. Deeds of seTlement agreed with builder for recMficaMon at his cost
On-‐going legal spend on liMgaMon reduced to $nil
Background Outcome
© Copyright 2011 Teys Lawyers www.teyslawyers.com.au
Join our next webinar
Join us for our next webinar at 4.00pm on 1 December 2011
‘Public Officials and Cer6fiers – What’s Their Fair Share of the Liability’
Reserve your seat now at:hTps://www3.gotomeeMng.com/register/900340382
© Copyright 2011 Teys Lawyers www.teyslawyers.com.au
About The Presenter
TEYS Lawyers pracMce naMonally in strata Mtle law represenMng owners corporaMons, bodies corporate and apartment owners. The firm’s pracMce groups include building defects, management rights, strata community disputes, by-‐laws and rules and levy and fee collecMon.
Subscribe for their free e-‐newsleTer StrataSpace and find out more about them at www.teyslawyers.com.au
Chris worked for many years in leading commercial construcMon law pracMces acMng for government, developers and contractors in disputes in the building, transport infrastructure and resources sectors. He has been involved in all forms of dispute resoluMon including liMgaMon, arbitraMon and alternaMve dispute resoluMon in a range of jurisdicMons in Australia. In the last few years, he has brought his specialist construcMon industry knowledge to the strata sector and now only acts for owners corporaMons in a range of disputes in various jurisdicMons.