Giorgio Marfella 0:07
Right, so good afternoon, everybody and welcome to another ARBV webinar. My name is Giorgio Marfella, and I am the Chairperson of the Architect’s Registration Board of Victoria. And like always, I like to begin by acknowledging the traditional owners of the lands in which we are meeting today. I mean the land of the Wurundjeri people of the Kulin Nation, and I pay my respects to the elders past, present and emerging.
So again, welcome back. We have Dariel De Sousa, who's the speaker, who's been with us many times today, who will be facilitating today’s session with us on a series of webinars we already commenced on the outcomes of our research report on strengthening compliance culture among architects. So, Dariel will be joined by three
experts. We will have today a perspective from a legislation point of view, from a legal litigation point of view, as well as from insurance. So, we have today, we're very pleased to have Dr. Matthew Bell, who's an Associate Professor of Construction Law at the Melbourne Law School.
And we also have Natasha Stojanovich, who is a partner at Lander and Rodgers, and Wendy Poulton, who is the Manager of Risk Services, informed by Planned Cover. Then Wendy is probably very well known among architects for insurance services. So, we have perspectives that are obviously external from architecture, but from people who are very well involved in understanding the implications of what it means to bring duties to the public. As always this is a valid CPD opportunity for all of you to take one formal CPD point and you can you can use this QR code to access the form that will give you evidence of having participated here. We will provide this also in a link in the chat. As always, I'll be back at the end if there's any questions to facilitate some final discussion points. But at this point, I can simply hand over to Dariel. Thank you.
Dariel De Sousa 2:24
Thanks so much, Giorgio, and good afternoon, everyone. So this is the 4th webinar in a series of 4 where the ARBV has shared its analysis and its findings from a compliance culture report, which was published back in 2025.
So my job is simply to provide a little bit of context for our guest speakers presentation and talk a little bit about the report. I am conscious, however, that a large number of you have no doubt attended the previous webinars, webinars 1 to 3.
So I'll keep my discussion about the background very brief.
As you may be aware, the catalyst for the ARBV’s compliance culture report was evidence from a variety of different sources indicating that there's room for improvement in terms of the approach and attitude of at least some architects and architectural firms towards their compliance obligations and you can see listed on this slide the sources of that evidence, including reports published by the Victorian ARB and the New South Wales ARB on systemic risks in the architecture sector in 2022 and 2024, followed by a report or a couple of reports, in fact, by Cladding Safety Victoria in 2024.
And of course, the Shergold Weir Building Confidence Report published in 2018. Now, the ARBV was concerned about this evidence, not because of the need for compliance for compliance sake, but non-compliance can lead to harm. Harm to your clients in terms of your relationships, but also in terms of built outcomes. There may be poor quality outcomes or unsafe outcomes, and also non-compliance can have an adverse impact on the profession more generally and undermine the trust and confidence in the profession.
So, the ARBV tasked itself with trying to enhance and strengthen compliance culture across the sector. In the understanding, as was pointed out by Commissioner Hayne in the Financial Services Royal Commission, that really, it's necessary to deal with cultural issues to drive, to really tackle root causes of non-compliance and drive lasting change.
Here is a summary of the objectives of the ARBV's work. I won't bore you with the details, but we have touched on all of them through the course of the four webinars, and you can read the details in the ARBV's report. We're really tackling the last bullet point on this slide during this webinar which is focusing on tangible actions that can be taken by architects to strengthen their compliance culture. And the lens that we're using for this webinar is architects' duties to the public.
Now, as many of you will already be aware, there are three key outputs from the work undertaken by the ARBV. The first is a detailed report summarising the ARBV’s analysis on the state of compliance culture in the architecture sector and how that culture can be strengthened.
There's a one-page high-level summary and most importantly for the audience, there's a booklet containing practical guidance for architects and architectural firms in terms of the top 10 things that sole practitioners, small firms and large firms can do to really strengthen their compliance culture. That booklet also contains some case studies for reference.
Now, there are some key concepts that I just want to revisit to help frame the discussion today. The first is what the notion of compliance culture actually means. So, compliance culture is the combination of values, assumptions, habits that really guide and shape behaviour and actions and decisions within an organization. And compliance culture matters not just to protect yourselves from action from the regulator-
-It can help enhance your relationship with your clients
-It can protect your clients from harm
-It can really support trust and confidence in the profession, and
-It can also set a positive example for the broader construction sector
In terms of what a strong compliance culture looks like in practice, you can recognise it within an organisation if there's a shared understanding and commitment to compliance. And compliance culture can be strengthened by all within an organisation really embracing their overarching duties, which are codified in the code of professional conduct.
Now, there is an interrelationship between the culture at the organisational level and the mindset of individuals towards compliance within the organization. So, as I mentioned, compliance culture is the accumulation of values, attitudes, habits and assumptions that shape or guide people's behaviour on an everyday basis. And the compliance culture within an organisation can affect an individual's mindset, particularly their compliance mindset and a compliance mindset will exist if an individual or individuals within an organisation have an internalised commitment
to comply with their obligations, even in the absence of oversight. And you can see that a strong compliance culture can create this virtuous cycle where the culture drives a positive compliance mindset, and then a positive compliance mindset within individuals within an organisation can help solidify and really strengthen compliance culture across the organisation so they're sort of mutually reinforcing.
Now, in terms of how you recognise whether a compliance mindset exists, there's a commitment to learning. So, commend all the people that are online because this demonstrates your commitment to learning. A thorough understanding of your compliance obligations, particularly what they mean in practise in everyday activities that you will undertake in your capacity as a professional. An acceptance of responsibility, not assuming that the job of compliance is somebody else's work, but rather you are part and parcel of the need to ensure compliance. A vigilant approach in daily tasks, not assuming that compliance will take care of itself, but being attuned and sensitised to the need for compliance and being aware of any compliance issues as they arrive. And finally, a commitment to a compliant pathway, notwithstanding the existence of barriers or roadblocks that may come across your path along the way.
Now, as I mentioned, a strong compliance culture really is established when all within an organisation embrace their overarching duties. And these duties that you owe as a professional are founded on three sort of main components. The first is the social contract that exists between you in your capacity as a professional and the broader community. In exchange for your status as a respected professional, society expects you to comply with certain minimum standards. Now, the regulatory framework comprising the Architects Act, the Architects Regs, and the Code of Professional Conduct, which was recently revised, really enforce the social contract. And finally, the common law, the case law, which Natasha will be talking to you about later in this presentation, helps to elaborate and clarify aspects of the social contract and the regulatory framework. And it's important to note that in fact, the code of professional conduct really just codifies what you are expected to do as a matter of common law in any case.
So what are your overarching duties? So, what the ARBV did in its compliance culture report was try to rise above the details of the compliance obligations that architects are subjected to and articulate 7 overarching duties that if you pursue and achieve, you will have gone a long way to establishing a strong compliance culture.
Here they are-
1. The duty to act with care
2. The duty to be competent, including educating yourself, including through this CPD session
3. The duty to act with honesty and integrity
4. The duty to comply with all applicable laws
5. The duty to treat confidential information accordingly
6. The duty to act impartially and avoid conflicts of interest, and
7. The duty to keep records and communicate effectively.
If you pursue these duties, you will go a long way to preserving a good relationship with your client to protect them from harm, but also to protect yourselves and the broader profession from harm. And if you're interested in the details of these duties, you can have a listen to webinar too, which is on the ARBV’s website.
Now, there are, it's important to note that while these overarching duties are universal and apply across the whole profession, there are nuances in terms of the way they apply in practice. In webinar two, we talked about how those overarching duties can be discharged when you interact with your clients. In webinar three, we talked about the implications of your duties vis-a-vis the profession. And today we're talking about your overarching duties and how they apply to the public.
And just again, by way of a practical context, it's important to note that the overarching duties apply at an individual level. What you need to do as an individual architect to discharge your duties, what your firm needs to do to support you to discharge those duties, what needs to happen in a project context when you're interacting with other project participants, and finally, the scope for sectoral support to help you discharge those duties.
As I mentioned, the guidance that the ARBV has prepared to supplement its compliance culture report includes the top 10 things that sole practitioners and small firms, as well as large firms can do to really consolidate and strengthen the compliance culture. I won't go through these. Again, we went through them in webinar 2, but they are available on the ARBV's website.
So now we turn to the topic of the day, which is architects’ duties to the public. Now, as I mentioned before, architects have a very special position in society because of their professional status. And architects are particularly important because they play an important role in shaping the built environment. Through their designs, they can affect the health, safety, wellbeing and well-functioning of society. And in recognition of this important role, the code of professional conduct, which is a schedule to the architects regs, expresses the architect's duties to the public and here they are- Article 3 or clause 3 of the revised code talks about the architect's duties to the public. So, it firstly states that when carrying out work, an architect must take all reasonable steps to protect the health and safety of people. It goes on to say that an architect has a responsibility, where possible, to act in accordance with the public interest and to give proper consideration to the natural environment, conservation of cultural heritage, including Aboriginal cultural heritage, and finally, conservation of natural resources. Now, in terms of what this means in practice, we're going to call on our guest speakers, starting first with Dr. Matthew Bell, who will give you his perspective from a statutory perspective.
Matthew Bell 15:00
Thank you very much, Dariel, and thank you very much for the opportunity to speak with you all today. I think from Giorgio’s and my point of view as university academics, I've learned such a lot over the years from working with architects as my clients and indeed as our students here at the University of Melbourne. And I think the session today is quite a good bookend, really, to the first session in which colleagues, including Bronwyn Weir, spoke about the idea of compliance culture.
So I'm going to start with this triptych, which would be familiar to many of you, especially if you visited the NGV in Federation Square, because this is, it's a Frederick McCubbin painting, which has always spoken to me of the difficulty, the challenge, but also the opportunities that's been faced in grappling with something that's new in this case for European people and grappling with the Australian landscape. But if we might go to the next slide, Dariel, that I think turns into a triptych now, sorry, next slide, thank you, which all of us as professionals can identify with. And again, I think this is very much what's been discussed through all of these, all of these seminars, which is that all of us as professionals and here we have an architect and all the things that she has to do, are facing a litany of different pressures on us at the same time as wanting to discharge our duties. So it's worthwhile just taking a step back and reflecting on this from all of our point of view as professionals in the way in which we interact with the built environment and interact with each other as well, because I'm about to deliver to you something which, if you're not familiar with it already, is potentially a very strong additional obligation, not just on architects, but all of us who interact with the built environment through something called the building system objective. We'll come to that in a second. But yeah, it's like a whole new spaceship of legislation that just arrives over the top of us when we're going through all of our daily lives of pondering what it is that we know, what it is that we're not so sure about, and of course, all the other pressures that we have, whether they are, you know, to get home in time to pick up the kids at the end of the day, right through to making sure that we can function well as a business and everything else. So I'm here to tell you, and we'll go to the next slide, if you're not familiar with it already, that we now have had royal assent, which is when a bill is passed by the Parliament and then goes to the Governor and she's put her signature to this last week. We've had royal assent to a new act which is called the Building and Plumbing Administration and Enforcement Act. Now there hasn't been a great deal written about this yet, you'll see some law firms have written about it.
I think one of the reasons for that is that it's more than 600 pages long and there's a great deal in it. But if you would like a bit of a ready reckoner on aspects of it, including the one I'm going to talk to you about now, I've got a piece on it in the University of Melbourne's pursuit online. And if you'd like me to send you a copy of the article in the Australian Construction Law Bulletin, just let me know it.
So, much like the code that Dariel has already spoken to you about for architects, this is now a building system objective is law and will come into force as by way of proclamation and if it doesn't, by the 1st of December of next year, to have this thing called the building system objective and it's section 6 of this new Act. You've got it on screen and hopefully you've had a read of it. It's not particularly long. I will be taking you through some legislative provisions before Natasha talks to you about some of those common law cases. But as you can see here, it's an overriding objective of the building system, which is a defined term, which I'll take you to shortly, to promote the health and safety of building documents and the public through design, construction, installation, commissioning of buildings, which refers off to the Building Act, et cetera, et cetera, through building and plumbing standards and building legislation, which also is defined. We'll come to that in a second. And likewise, in relation to building system regulators, and that's widely defined also, which I'll come to in a second. But spoiler alert, it includes the ARBV.
Now, if we might go to the next slide, thank you, Dariel.
So, the operative provisions, there's not a great many of them throughout this 600-page piece of legislation, but they do have potentially far-reaching effect. And I've spoken about the way in which these types of provisions have been interpreted in the Construction Bulletin article.
We don't have much that is directly relevant, but I don't think it'll surprise you to know that any time there is a very strong objective or purpose being put forward in an overriding piece of legislation like this, judges will be expected to pick up on it and indeed they will. So, I'll come back to that in my final remarks about this shortly. But it is at least something that we all need to know about. So, when we talk about in section 11(1) that a person in performing any function or exercising a power under this building legislation must have regard to the building system objective. Well, even though a person does not directly mention architects or for that matter, lawyers or academics or anybody else involved with it, a person is very widely defined as a matter of law. So, it certainly would cover all of us in our interactions. And as we'll see particularly picks out building surveyors and the ARBV itself. So it then goes on to say that entities also need to have regard to entity specific objectives and I've put in the fine print there that there are certain entity specific objectives for the new Building and Plumbing Commission and others, not surprisingly, but those entity specific requirements include reporting obligations back to the minister and the relevant secretary. So, all of these things will be, I think, are intended to be monitored and reported upon, and therefore they sort of will permeate their way through the entire building system, as it's called. Now, there is a subsection 3, which says Parliament does not intend to create in any person any legal right or to give rise to any civil cause of action. We don't know exactly what that means, but from the second reading speech and other things, I think we can take that to mean that of itself this is not intended to give rise to a right to sue each other through section 11 itself. But of course, this is the sort of thing that would be taken into account in setting common law duties of care and indeed the standard of care that needs to be applied.
Now, I'll just go to the next slide, please, Dariel.
And I know you all love going through sections of legislation, but you can see here that the building legislation definition itself is very wide. It not only includes what you'd expect, the Building Act and its regulations, the Domestic Building Contracts Act, but also includes various other, the security of payments legislation as well, and the opportunity for the department to prescribe other pieces of legislation potentially as well. And then it does say explicitly in section 4(2) that the building legislation has widely defined is to be interpreted having regard to this building system objective. And if you're wondering what the building system is, that's in section 5, which talks about the building and plumbing industries. So again, very wide and building system regulators.
And we go to the next slide, Dariel.
So, my final one, you may be pleased to know. But you can see here that the building system regulators are very widely defined. I've just highlighted there for you a couple that might be particularly relevant to people on this webinar, including relevant building surveyors, as well as municipal building surveyors, and the Architect’s Registrar Board of itself. So it's very widely defined there.
So I was just going to wrap up by saying we don't know exactly how this will be interpreted, but based on other interpretation provisions and cases in the past, we can expect that particularly if there are marginal issues or ambiguities, in either behaviours or for that matter, within the types of contracts that we have or other sorts of provisions, then if it was to come before a court, then a court would ordinarily not just be expected to apply and have regard to this building system objective, but potentially it could be the tiebreaker, as it were, to decide that we do need to put health and safety of the occupants of buildings and indeed the broader public first. So that's one of many interesting provisions in this new act, which is itself part of a plethora of new legislation which is coming through, so just thinking back to our architect in the triptych before, there is an enormous amount that we all need to be aware of. And of course, as a lawyer, you have my entire sympathy about that, but also as a regulatory scholar, I do hope that this is, now that this provision is through, that it will help to move the dial a little bit if anybody is in doubt about the need to privilege health and safety. Thank you.
Dariel De Sousa 25:30
Thanks so much, Matthew, for that statutory context, which is really helpful. Can I ask Natasha to join us now? And she's going to be sharing some of the case law with us.
Natasha Stojanovich 25:44
Excellent. Well, thank you. Thank you, Dariel, and thank you to the ARBV for the invitation to join you this afternoon to talk about one of my favourite topics, which is trying to keep architects out of trouble. So, I'll be touching on the failure to comply with duties to the public. And in terms of what I will be doing in my allotted 10 minutes, I'll be running through three sort of case studies, of matters sort of de-identified loosely based on some cases in which I've been involved, to really try and breathe some life into what this all means in a practical sense, i.e., you know, there's often a bit of a misconception amongst architects that, you know, they're only, they only have obligations and duties to their clients, whereas their obligations and their duties, as Dariel has very articulately outlined, are much broader than that as a result of, you know, the code of conduct, laws generally and the common law as well. So, I'll be running through very briefly 3 factual sort of scenarios and detailing the consequences that have arisen in the context of these specific factual sorts of scenarios.
So the first one that I'm going to run through is a case study about the very obliging architect. And I think that this is important because most of the architects that I deal with in my day-to-day generally jump out of bed in the mornings wanting to do a really good job for their clients and wanting to build really high performing buildings and they want to do the right thing. And sometimes that can leave them a bit
vulnerable to pressure from their clients to perhaps go above and beyond what they've been engaged to do or paid to do, or to be pressured to take risks sort of stray into sort of areas outside of their scope of professional responsibilities. So, this example is about the architect being pressured to provide monthly inspection certificates, complying that all the works comply with the design documentation. So that's a representation obviously being made to your client, but to who else?
So, if I could get the next slide, please, Dariel.
So, in this instance, the builder fell away and many years after completion, the architect was dragged into litigation and those certificates that indicated the work was complete and had been carried out in accordance with the design documentation were relied upon by subsequent owners. So, the owners corporation and individual lot owners to sue the architect and to say, well, essentially, if there were construction deficiencies, architects, you were the one boots on the ground inspecting this work. This was your responsibility to pick this up.
And so in this instance, obviously, you know, the architect has, by providing these certificates, opened themselves up and made them sort of vulnerable to ultimately taking on legal responsibility for building defects rather than design defects, which arose sort of directly from the provision of architectural design advice per se.
So perhaps if I could jump through to the next slide, trying to be very conscious of time here. The La Crosse fire, so this is obviously not a de-identified example. This is a very out in the public example about a fairly dramatic incident involving the La Crosse building in Melbourne's Docklands and involving a very high-profile fire, which took place in November of 2014. So relevantly off the back of the fire, we saw, and in this instance, the architect had been novated to the builder, had, quote unquote, signed off on the substitution of a particular cladding related product. In the course of the litigation, there was some disputation about whether or not the signing off was purely for aesthetic purposes or alternatively was a much broader agreement and approval of the substitution of the particular product. So, I won't go into that in too much detail. But perhaps if I could just jump through to the next slide in terms of what happened off the back of the La Crosse fire and the subsequent impacts. So, there was a very long running trial that ran in VCAT, a claim for $12.7 million plus interest plus costs against the builder and against the consultants involved in the design and the construction of the building. So, both for the fire and water damaged parts of the building, but also the other aspects of the building, the other facade elements of the building that hadn't been damaged by fire, but which were considered to be non-compliant and to contain combustible cladding that was unsafe and required removal. So, a very expensive problem at the end of the day.
And both the builder and the various consultants faced legal claims from the owner’s corporation and the relevant owners of the building. So, the case ran to a full hearing. It also ran to appeal. And so, in addition to the civil consequences, disciplinary prosecutions of the practitioners were also pursued.
And it probably goes without saying when I'm talking about that much litigation taking place, that it was very expensive, very stressful, and it ran for a very long time. And you know, caused quite a deal of stigma for the building itself, and obviously carried with it some reputational impacts. And so just to recap, in terms of the ultimate liability finding against the architect that were found liable for 25% of the overall damages billed. So pretty significant financial consequences where you're looking at that 25% of the $12.7 million, but in addition, exposure to the architect's own legal costs on the one hand and also potential exposure to the other parties and the builders' legal costs as well. So, you're certainly talking about some significant sums of money.
Okay, well, if we could jump through to the next example.
So, this case study is called Grand Designs. So, this particular incident involved a once in a lifetime and a very high-profile project that ultimately became a candidate to win a fairly coveted International Design Award, very high-profile architects involved in a very sort of specific architectural vision. And I'm certainly not an architect, so I'm not going to stray into the lane of talking about the architectural vision and the specifics of what that involved, aside from to say that it involves some sort of modifications that were not strictly BCA compliant in the sense of DTS compliant. But ultimately, it led to a scenario where there was an issue about whether or not the relevant balustrades in a particular section of the building were compliant or not, or created a hazard, notwithstanding that, you know, on one view and based on the advice of some of the participants involved in the design and the construction of the building, they were arguably compliant.
So, if I could jump through to the next slide.
Spoiler alert, it didn't end well. Once the project became operational, the project was in use and at a particular event, one of the spectators fell over the balustrade into a very significant void below and, you know, suffered some really, really horrific injuries. So, off the back of that, you know, what were the consequences? So really significant media coverage, reputational impacts for all of those involved. The project became quite infamous as a result of the incident and rather than focusing on the
the shiny architectural award, you know, there was a real sort of focus and stigma around this incident and this terrible incident that had transpired. And what we saw off the back of that was a civil claim that involved not only the architect, but the building surveyor, the owner of the building, the builder and the project manager. So, it again, was a fairly reputationally damaging sort of process. There were civil liabilities involved. And obviously, where we're talking about civil liabilities, you know, one would hope, and it's a nice segue into Wendy's presentation, that, you know, obviously your professional indemnity insurance is going to be there and is going to protect you. But, you know, that in and of itself, if you do have claims that are made against your PI policy may in turn have an impact upon your insurance premium in years moving forward, or, you know, if it's particularly severe, you know, potentially your ability to obtain PI insurance full stop. So, these things can have pretty drastic sort of consequences. So, just to sum up, you know, it's really important, I think, as professionals to not only look through a project through the lens of what am I doing for my client, but this broader lens of what are my duties to the public more broadly, because a failure to take that into account can potentially have some serious consequences. And just to name probably the top four, obviously the risk of legal liabilities, disciplinary prosecution by relevant regulators, reputational damage, you know, a loss of trust in the profession, and some pretty significant, you know, bottom line commercial consequences, so impacts on insurance premiums, needing to pay excesses, etc. these sorts of problems can become quite expensive. So that's all for me.
Over to you, Wendy.
Dariel De Sousa 35:15
Thanks so much, Natasha. And yeah, thanks so much for going through some really helpful illustrative examples. And we'll pass over to Wendy now to talk about the insurance perspective.
Wendy Poulton 35:28
Thank you, Dariel. Thank you, everybody.
I might start on the next slide just by quickly explaining how we fit into your professional lives. We're part of a broader business called Planned Cover. They are insurance brokers and place insurance for a large proportion of the profession. They have a team of claims managers who, under their brand name Focus Underwriting,
are often the initial point of contact for managing insurance claims. Our team at Informed by Planned Cover provide contract reviews and CPD, and it's through that broad range of contact points with the profession that we draw in the knowledge to present today's presentation. So, if we can move to the next slide, one of the points that we get from our experience is that the factors contributing to claims against the public can be quite different from the factors contributing to claims by clients against architects. So, you can see that the claims by clients are often generated by money issues, cost overruns, calculation of the architect's fees, site conditions, including
site boundaries, setbacks, that kind of thing, delays, errors and inconsistencies in documentation and administration of the construction contract. We do see pure design errors and waterproofing is one of the key areas where those occur. By contrast, claims originating from the public tend to fall into two broad categories.
One is claims by individuals who've been injured, and we've already seen some examples of that in Natasha's presentation and claims by owner’s corporations in class 2 buildings and again waterproofing and code compliance are two strong contributors there. So, if we move to the next slide, I've split those into two areas and let's talk about those injuries first. But to start with, these personal injury claims
less than 10% of the total expenditure on claims that insurers are likely to make. Their claims are much more likely to be about money and the cost of rectifying defects. Still, these injury cases are important, so we'll look at them. They can be contributed to by people slipping on stairs, paths through garden beds and car parks, ramps, certainly anywhere, any surface that can get wet will add an increased risk of people slipping over them. We've already seen an example of a balustrade claim. We've also seen claims where balustrades contained gaps that unfortunately exceeded the code minimum and were big enough that a child could potentially fall through them. In a piece of good news, when I started in this sector 20 years ago, we were in the middle of a spate of claims arising out of balcony collapses, particularly on single dwelling houses. You'd have a party, large numbers of people on the balcony, and it wasn't made to support that weight. But I'm not sure that that is as nearly as big a contributor as it used to be. So that seems to be something that we have got under control.
Compared to that, claims by owner’s corporation can come from various areas and Natasha's already illustrated some. Waterproofing is one consideration and the other is compliance with the National Construction Code and in particular in that La Crosse building example, compliance with the NCC requirements applicable to the
non-combustible characteristics required for external walls. If we can move to the next slide, I wanted to give you, actually, no, we can stay on that slide, but just to flesh that out with some more examples. One of the balustrade claims, it's an older one, but it always keeps delivering, as a good example. There's a claim a couple of decades ago where an architect was successfully sued for designing a balustrade where the design documents were inconsistent and unclear. Some documents showed a balustrade of 1000 millimetres on the landings of a stairwell in a Class 2 building. Other design documents, it looked like 950 ml might have been what the design called for that was below the relevant National Construction Code requirement. A gentleman was knocked over the balustrade when two friends he was with were engaging in some sort of rough wrestling. He suffered quite significant neck and back injuries. It's A $2 or $3 million claim. I am grossly oversimplifying a very complicated claim, but the architect ends up with about 7% liability for that very expensive claim.
Another example, sorry, the key takeaway from that one is simply NCC prescribes minimum standards and meeting them is your strongest defence to claims. In this other example, we're in a public space now, it's a club, and it concerns the car park of the club. The way the car park worked, if you reversed your car into a car parking space, behind that was a curb and on the other side of the curb was a garden bed. The garden bed was sunk by between 700 and 800 millimetres. So not that big of a gap, but enough that you could injure yourself. Being a garden bed, it had initial plantings, but those plantings grew, and by the time they reached full height, they tended to obscure the fact that there was a drop there. So, a gentleman was injured when he was putting items in the boot of his car. He stepped back and fell into the garden bed and suffered injuries. The architect was found partly liable for that claim, so was the club. And an exacerbating factor there was that the incident happened at night where there was less light and less ability to see the potential risk hazard. That one's not a national construction code breach. The takeaway there is more picturing the premises in operation and how those factors like the growth of the plants in the garden bed can contribute to risks that might not be otherwise obvious. And one final example, this is a personal injury claim where against a building designer, technically not an architect, a woman was injured when she was walking down a staircase in a holiday home. She was, the staircase was a U-shape and in the two corners, one had a landing and the other had 45-degree winders. It's at that, the small area of the 45-degree winders is where she slipped. The substance of her claim was that the architect shouldn't have used 45-degree winders. Oh, sorry, beg your pardon, building designer, not architect, and or should have installed automatic sensor lighting and a continuous handrail down the stairs. The court ends up finding that at the time the building code, the NCC, did not call for any of those things and 45-degree winders were a not uncommon feature in domestic premises. So, the claim against the building designer failed in that instance.
So that's three examples and my apologies, Dariel, we are now ready for that next slide.
Coming back to those claims against or from owner’s corporations, I wanted to give you some resources that can help. The first is this one. It's from New South Wales, but it illustrates issues that could just as easily arise in Victoria and arise on classes other than Class 2. The Building Commission in New South Wales looked at their data on common factors that were contributing to difficult and expensive defects in Class 2 buildings in New South Wales and they published this building defects library that you can search and easily find that reports on some of the underlying causes. And some of them are very simple things-
-Inadequate falls on roofs, balconies and bathrooms
-Inadequate flashings on external doors and windows
-Membranes on roofs and balconies not turned down into the drain, or
-Not turned up to the vertical where they meet the balcony door or walls.
Those are simple things, but when they go wrong, they can contribute to disproportionately expensive claims. Waterproofing is expensive to fix. It often requires pulling out elements of the building to get to the membrane underneath. And if the waterproofing issue is not detected for some time, the longer it goes on, the more structural damage it causes, and that in turn generates a much more expensive claim to resolve. So, you really can't do enough to design with care any aspect that touches on waterproofing. And if you have a role in inspecting the building works, it's another area where you want to apply extra care and skill. So, I commend that to you as a useful resource.
And finally, moving on to the final slide.
National Construction Code compliance is one of the strongest defences that you have to avoid claims or to avoid problems and to avoid claims. So, the National Construction Code, it's not just a guideline, even though you may occasionally deal with people who treat it like one. It's mandatory, it's called up in the Building Act here in Victoria. You either comply with it by following a deemed to satisfy solution or by adopting a performance solution pathway. And just a reminder that if you're taking that second option, part A2G2, subsection 4 of the code now sets out specific requirements for a documentation trail that has to sit behind your performance solution and create a record of why that solution was justified.
I appreciate that NCC is a complicated, difficult, lengthy document, so I'm not going to talk through them, but I've given you 3 links here that will help you with that. The first is a summary of jurisdictions that have adopted the new 2025 NCC, and the last two are CPD opportunities from the Building and Plumbing Commission here in Victoria and the Australian Building Codes Board to help you increase your knowledge and refresh your knowledge about the code.
And with that, Dariel, I'll hand back to you to wind up.
Dariel De Sousa 45:18
Thanks so much, Wendy, and thanks for those excellent references. For those that would like to access them, the slides will be up on the ARBV’s website shortly, so you will be able to access those links. Just some concluding remarks before we start the Q&A session. We've already sort of touched on these broad issues. The first is, as I mentioned before, that architects do occupy a very important position in society because of the impact of their work on the built environment. And we've heard through the case studies that both Natasha and Wendy have shared with us that this role is quite significant. So, as I mentioned before, in recognition of this important position and this important role, the code places clear obligations on architects to take reasonable steps to protect the health and safety of members of the public and where possible to consider the environment cultural heritage and the responsible use of natural resources. And as Natasha has already pointed out, the duties in the code are already reflected in the common law. It's also important to note that these duties are not merely procedural requirements where you can just tick and flick. They really reflect the profession's role in ensuring the wellbeing of society as a whole. And when architects honour these duties in their true spirit, the result is safer buildings, stronger communities and more sustainable long-term outcomes for the public. Conversely, failure to meet these obligations may constitute unprofessional conduct and result in regulatory action, and failure may also result in a broad spectrum of implications and consequences that both Natasha and Wendy have pointed to.
So, with that, we're going to pass to the Q&A session. I'm just putting up the QR code here one more time for you to access the quiz questions.
Now, Giorgio, who's the chair of the ARBV, I believe is with us to chair the Q&A sessions, but I know he was having some technical issues.
Giorgio, are you there? And if not, I'm happy to take that role on.
Giorgio Marfella 47:42
Yes, I am [interruption in audio]
Dariel De Sousa 47:45
Great. Thank you, Giorgio.
Giorgio Marfella 47:45
And to do it [interruption in audio] so long as you can please confirm [interruption in audio] I can facilitate this.
Dariel De Sousa 47:55
Please go ahead, Giorgio, and maybe if your audio cuts out, you can turn off your camera. That might help with the audio.
Giorgio Marfella 47:56
If you hear me well now, so there was some interesting [interruption in audio] things that came up, and so I'll to all of you, and then [interruption in audio] we would like to jump in each one of you [interruption in audio] context feel free. So, the first one is about preservation of health and safety [interruption in audio], suppose it seems to me [interruption in audio] more a question, but [interruption in audio] take the opportunity to ask [interruption in audio] the how important in the context of the duty of the [interruption in audio] legislative point of view.
Matthew, perhaps you might want [interruption in audio] a thought.
Matthew Bell 48:49
Thank you, Giorgio. So, forgive me, I didn't quite hear it, but I think the question was how important is having this overarching duty as a matter of legislation? Is that the question in relation to health and safety?
Giorgio Marfella 49:04
Exactly [audio lag]
Matthew Bell 49:06
Thank you very much. Well, I think most of us are aware of the historical context in which these legislative reforms have come through. So if we were just to land from outer space today and say, goodness me, why is it that in Victoria, we now have not just this building system objective, but thousands of pages of additional legislative reforms which have come through in the last few years, it may not make a great deal of sense, but in the broader historical context, I think we're all aware not just of what happened at La Crosse and the other examples that Wendy and Natasha have mentioned, but of course, the fires in Milan, in Grenfell Tower and others. So I think, from a reform point of view, there has been a sense in which that overarching duty, even though most of us would believe in it as a matter of principle, has been lost sight of in the very, very large number of considerations and interests that need to be taken into account for all of us doing our jobs as professionals in the construction industry. So that's a long-winded way of saying, I think, putting the health and safety objective in its terms, you know, were not greatly debated as they went through the parliament, but I think they are very interesting and it will be certainly very interesting to see how those exact words are operationalised through not just the industry, but also the way in which they're interpreted by the courts. I do think that putting them front and centre, or as it were, as an umbrella, sets a very clear message across all of our building industry, that this is something that's very important to us in much the same way as any time you get on a plane, the first thing they say to us is there's nothing more important than getting there safely.
Giorgio Marfella 51:07
Thank you Matthew [interruption in audio]. So Dariel, would you please [interruption in audio] the Q&A [interruption in audio] it seems like I'm not [interruption in audio] very well today, apologies.
Dariel De Sousa 51:18
Sure. No trouble, Giorgio. I'll try to scroll through a number of the questions. Wendy, there are a couple of questions directed to you about building designers, noting that one of the cases that you talked about involved a building designer. So just to summarise those questions, what are the key differences between building designers and architects? And are they held to different standards? And there's a legal answer to that as well as a practical one. So, I might leave you to have a go first.
Wendy Poulton 51:48
Thank you. I would have thought, I mean, building designers are not subject to some of the specific regulatory obligations that apply to architects because of the architect's code of conduct, for example, but they still have a common law duty of care, a duty not to be negligent, and that duty is formulated essentially the same way as an architect's. And that duty is that they have to act with the care and skill of a reasonable building designer. If they don't do so, they've been negligent. The reason I gave, I should have said, the reason I gave a building designer case is I don't think that would have played out any differently if it had been an architect than the fact that it was a building designer wasn't material to the actual code compliance question.
Dariel De Sousa 52:38
Sorry, Wendy, I might just add to that. I guess the distinction between building designers and architects, I guess, is the fact that architects are subject to the architect’s regime. And in fact, that is a plus in certain respects in the sense that it does set out a regulatory framework that really helps architects to discharge these common law duties. So, as I mentioned before, the Code of Professional Conduct enshrines some of those core common law duties. And if architects follow those duties and the Code of Professional Conduct, it will really help them protect themselves ourselves against some of the claims that we've heard about. Now Natasha for you and, and potentially for Wendy as well, is there a time frame in which these sorts of claims for public harm need to be made?
Natasha Stojanovich 53:40
Yes, in summary. So, there's a few different time frames depending on what particular, what your cause of action is. Personal injury sort of litigation is a whole sort of beast of its own in terms of applicable limitation periods. I mean, where you are talking about claims involving building defects, the limitation period you're generally talking about is 10 years from the date of issue of the occupancy permit, unless of course, you're talking about a cladding action, in which case you might be 12 or 15 years. So, it is a little bit complex. And again, it's one of those reasons why you want to have the right sort of insurance programmes in place to protect you, even if a claim is made many, many, many years after you've provided your architectural services.
Dariel De Sousa 54:23
Thank you. And just one more question for you, Natasha. In relation to your first case study where those certificates were issued by the architect, the question is, is it common for architects to issue progress certificates during construction or is that more a role discharged by other entities.
Natasha Stojanovich 54:46
Look, in an ideal world, with an architect's hat on, you'd be getting a QS or someone else to do it. In practice, sometimes architects are asked to sign off on certificates around, you know, whether or not there's substantial compliance with the approved design documentation and those sorts of things.
I think, you know, it's not a case of, I think, never, never do it. All I would say is that there are risks associated with it and it's just important to really carefully word those certificates if you are providing them so that it's clear what you are doing and what you're not doing.
Dariel De Sousa 55:23
Thank you. Wendy, one for you. Do water proofers need to be licenced in Victoria? If it's such a crucial area where errors commonly occur and insurance is, you know, quite prevalent in this area, what sort of regulatory requirements apply to the waterproofing exercise?
Wendy Poulton 55:47
I actually don't know the answer to that one. We only place insurance for design professionals, not any of the people who actually do the installation. So, I'm less familiar with their regulatory requirements. I would have thought you'd be looking to, you know, if the issue is that the design didn't properly specify the waterproofing,
that would be a matter for the architect's professional indemnity insurance to cover. If it was that the builder didn't correctly install the waterproofing, you probably, let me think about that. I guess you might have statutory warranty insurance that would apply if it's the right class of building and the builder had it. But no, I'm sorry about waterproofing installers specifically. I don't know enough about the regulatory requirements behind them.
Dariel De Sousa 56:30
Okay, thank you. Matthew, one for you. Do you, how do you think the new building system objective will play out in practise for architects, noting that at common law and also under the code of professional conduct, architects already have a duty to act in the public interest and take health and safety of the public into account. Do you think the building system objective will practically change the way architects need to behave in practice?
Matthew Bell 57:02
Thank you. And it's a great question. It is the, I want to say, $64,000 question. It's $64 billion question in some ways, because as I was trying to explain during my presentation, we're never quite sure how these things will be operationalized. I think the main thing you can see particularly when it says that the system objective of itself won't give rise to civil liability, I think it is setting the scene for really a regulatory and reporting requirements, which will permeate its way through the system, including, of course, in making sure that we're all informed about this through these types of CPDs and the role of the new regulator as well.
So, a short way of saying we're not sure, but it's not, as you say, it's not inconsistent with the duties that are already in existence. I guess from architects point of view, they are things in my own personal experience dealing with architects, you've been well aware of the need to protect health and safety. So, my personal view is that it's of greater relevance in those parts of the industry where people have been a little bit more ambivalent about the need to protect health and safety in exactly the same way that has been done for many years by architects and engineers. But as I said, you know, just look at the breadth of it. I think it's a very clear signal from the legislature.
And once that's in place, there's no reason why it can't then form the basis for civil penalty and other types of provisions if indeed there are breaches of it.
Dariel De Sousa 58:53
Thanks so much, Matthew. And Wendy, perhaps the last question before we need to wrap up. Are architects responsible for failure due to plumbers or other trades not doing things to code, assuming that the design drawings are correct? I know that there was a discussion of a case where the design documentation was not adequately detailed, but I'm interested in your response to that question.
Wendy Poulton 59:23
Yeah, I would say not automatically responsible, but if the architect has a role in inspecting the built works, as on a great many projects, they will. If they have, if they undertake those inspections as a minimum, they have to use reasonable care and skill to detect defects that a reasonable architect could detect.
So that's kind of the question you're asking. If it's a hidden defect that you couldn't reasonably be expected to see, and if it's not an area where you would have directed a whole point and inspected the work before it was built over, then I don't see why the architect would be liable for that. But if it's something that was visible on the surface or something where architects would typically note a whole point and inspect the item before it was built over, and you didn't detect it, then there's a potential negligence claim there. And on top of that, if you've signed certificates saying I have inspected the constructed works and they comply with all codes and standards and have no defects, I mean, little asterisks don't provide certificates that say that much,
but if you've also certified the works, then that gives you also a layer of risk. So, one takeaway is that you don't want to certify things like the works comply in all respects; you want to be saying, to the extent that I could observe the works from an exterior observation, these are the defects that I didn't, that I detected.
Dariel De Sousa 1:00:42
Thanks so much. And I'm sure I speak on behalf of Giorgio to thank you all for attending but thank you also to our excellent guest presenters for their insights and really informative presentations. We're grateful for your contributions and hopefully the audience have taken away some really practical tips and tools that they can implement in their practices. So, thank you very much and we'll see you all next time. Bye bye!
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