The Design and Building Practitioners Act 2020 (D&BPA) was introduced in NSW to address defective construction work, particularly in multi-level residential buildings. A key feature is Part 4, which imposes a statutory duty of care on professionals (engineers, architects, developers, building contractors etc.) to prevent economic loss to landowners due to defects. This duty applies retrospectively, allowing claims for up to 10 years before the Act’s commencement.

Key Court Decisions

Recent NSW Supreme Court cases clarified the scope and application of the D&BPA:

1. Goodwin Street Developments v DSD Builders (2022)
   • Section 37 applies beyond Class 2 buildings (e.g., apartments) to include commercial buildings and boarding houses.
   • Individuals (such as architects, engineers, project managers and supervisors) can be personally liable for defects if they exercised substantive control over construction.
   • The corporate veil does not shield individuals from liability.
2. The Owners – Strata Plan No 84674 v Pafburn (2022)
   • Developers can owe a statutory duty of care if they have substantive control over construction work, even if they do not physically carry it out.
   • Liability extends beyond builders and contractors to anyone with the power to control the work.
3. Boulus Constructions Pty Ltd v Warrumbungle Shire Council (2022)
   • Directors and employees of building companies may also be liable if they supervised, coordinated, or managed construction work.
   • The court affirmed that a director engaged in “construction work” is subject to the same duty of care as their company.

Insurance Implications

• From 1 July 2023, registered building practitioners must have adequate insurance for any work they certify.
• Insurance policies must cover retroactive liability for past work and include run-off cover for up to 10 years after a professional leaves the industry.
• Professional Standards Schemes may need to revise their policies to align with D&BPA requirements.

Key Takeaways:

• Section 37 applies broadly beyond Class 2 buildings.
• Personal liability can extend to architects, engineers, project managers, supervisors and company directors.
• Developers with substantial control may be liable under the D&BPA.
• The Act continues to be tested in court, with some ambiguities remaining, particularly in defining “persons” under different contexts. The implications of the D&BPA are evolving, and legal advice may be needed for those affected.

Further detail relating to your “Duty of Care” has been detailed by Bannermans Lawyers and their full articles can be read

• “Design and Building Practitioners Act, Duty of Care, Professional Indemnity Insurance & Professional Standards Schemes”
• “Piercing the corporate veil with the duty of care under the Design and Building Practitioners Act 2020”.