The NSW Court of Appeal has confirmed that carrying out construction work (as defined) in NSW since 2010 has attracted a duty to exercise reasonable care to avoid economic loss caused by defects in or related to all buildings for which the work is done and arising from the construction work. See our previous article on the Supreme Court decision here.
Whilst the judgment (Roberts v Goodwin Street Developments Pty Ltd [2023] NSWCA 5) restated that the duty of care applies in relation to all buildings, the Court of Appeal differed in its reasoning in reaching that conclusion.
The Court of Appeal focused on giving application to both the section 4(1) and section 36(1) definitions of “building work” in the Design and Building Practitioners Act 2020 (NSW). The Supreme Court had decided that the definition of “building work” in section 4(1) had no application given that the duty of care, contained in the separate Part 4 of the Act, contained its own definition of “building work” in section 36(1). The Court of Appeal, however, found that the section 4(1) definition applies to the further definition of “building work” in s36(1) but only to identify the type of work being undertaken. This means that if the work is involved in, or involved in the coordinating or supervising work involved in, the construction of a building or alterations, additions, repair, renovation or protective treatment to a building, that work will be subject to the duty of care.
“Construction work” for the purposes of the duty of care also includes supervising, coordinating, project managing or otherwise having substantive control over the carrying out of “building work”. This, along with the differing commencement dates for section 4(1), being 1 July 2021, and Part 4, being 10 June 2020, were not considered or regarded by the Court of Appeal as having an effect on the way in which the legislation is to be interpreted.
Given that the Court of Appeal states that there were reasonable arguments for three different interpretations of the relevant provisions, it would be preferable if the NSW Parliament passed legislation clarifying the application of the duty of care.
For more information, please contact Grant Parker, Veno Panicker and Hamish Geddes.
