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Good news for Victorian apartment owners

Builders who installed non-compliant cladding on apartments in Victoria have been put on notice, with apartment owners now given an extra two years to launch claims against them.

The extension from 10 to 12 years allowed by The Cladding Safety Victoria (CSV) Bill is intended to provide building owners, as well as the State Government, with additional time to conduct due diligence to determine if legal proceedings should be brought against those who installed combustible cladding on their buildings.

This extension applies to all claims where the claim period expired or is due to expire between the date of the Government’s announcement of the cladding rectification program – 16 July 2019 – and 12 months after the new Bill commences.

To further support impacted homeowners, the State Government is also chasing wrongdoers through the courts on behalf of owners in the most serious cases, where the state pays for rectification costs and the builder is found to have a case to answer after a thorough investigation.

Under the legislation, introduced in the Victorian Parliament last week, the Bill will also formally separate Cladding Safety Victoria from the Victorian Building Authority and establish it as the responsible authority for delivering the Cladding Rectification Program.

MinterEllison partner Peter Wood says under the provisions of the Bill, municipal building surveyors are to notify CSV of buildings they consider require cladding rectification work. CSV will then triage according to a prescribed criteria, likely to be set down by forthcoming regulations.

CSV will then determine if the buildings referred to it will be registered in its program and if it will grant financial assistance for the cladding rectification work. Such considerations are likely to include the amount to be loaned and whether rectification works are required to mitigate the risks posed by the non-compliant or non-conforming external wall cladding products pending rectification.

Wood says where CSV does determine it will grant financial assistance for cladding rectification work, CSV must enter into a funding agreement with the affected building owner or owners corporation.

Upon completion of any cladding rectification work under a funding agreement, CSV must notify the Minister, the VBA and the relevant municipal building surveyor of its completion.

The move follows the announcement in July last year that the Victorian Government would fund a $600 million package to fix buildings with high risk combustible cladding and establish CSV to oversee the world-first program.

CSV works with building owners, owners corporations and the building sector to rectify buildings and make them safe.

Commenting on the announcement, Victorian Minister for Planning Richard Wynne said the works will be prioritised based on risk to ensure buildings which present the highest risk to occupants are rectified first.

Wynne said Victoria is leading the world in responding to these types of problems, and it is important to ensure those who have done the wrong thing contribute to the cost of fixing their mistakes.

“Apartment owners are in this situation through no fault of their own and it’s only right they have as much time as possible to pursue compensation through the courts.”

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