The RAB Act provides consumer protection through proactive investigations and enforcement to prevent ‘developers’ from completing a building and an Occupation Certificate being issued where there is a risk of serious defects.
Some of the enforcement powers under the RAB Act include:
- giving the Building Commissioner and other authorised officers investigatory powers;
- requiring developers to notify and update the Secretary of the expected date of completion of the building work at least 6 months prior to the application for an Occupation Certificate;
- allowing the Secretary to:
- issue ‘Prohibition Orders’ against the issuing of an Occupation Certificate or registration of a strata scheme;
- issue ‘Stop Work Orders’ if they are of the opinion that the building work is or is likely to be carried out in a manner that could result in significant harm or loss;
- issue ‘Building Work Rectification Orders’ if building work was carried out in way that could result in serious defect or building has a serious defect; and
- enter enforceable undertakings with developers for the carrying out of building work.
The RAB Act applies to class 2 buildings, or buildings containing a class 2 part, since September 2020, however like the DBP Act, from 3 July 2023 it will apply to construction work on new class 3 and 9c buildings.1
The next phase
In 2022, the NSW Government introduced the Building Compliance and Enforcement Bill 2022 to consolidate the legislative framework for regulating building compliance and enforcement in NSW. The proposed changes will repeal the RAB Act and include:
- Orders: Expansion of the existing building works rectification order and stop work orders to all classes of buildings and an expanded application of prohibition orders.
- Demerit scheme: Introduce demerit points scheme to deter licence holders from committing offences and sanctions for repeat offenders.
- Penalties: Increased penalty offences for serious matters, including significant fines for a failure to provide information or records to the Building Commissioner or other authorised officers. These fines can reach upwards of $1,100,000 for breaches by corporations.
- Notice of OC: Retention of the existing expected completion notice.
- Phoenixing: Duty for certifiers, registered practitioners and holders of contractor licences to take reasonable steps to ensure that a person which those parties’ contract with has not been previously involved in intentional phoenix activity.
The Bill was closed for public consultation in November 2022 and is currently under review by the NSW Government.
If you would like a further explanation of the RAB Act and the above proposed reform, please contact a member of the Construction team.
1 Building Legislation Amendment (Building Classes) Regulation 2023 (NSW)