The MBV and HIA have voiced their disapproval at the newly proposed domestic building legislation in Victoria

MBV and HIA have both condemned proposed new building legislation as ‘unfair and unworkable’

Undoubtedly, legislative change is needed given the extent of workmanship issues in Victoria, delays at VCAT and the need for confidence in the building sector. No one can disagree that we need to build more homes.

However, the Building Legislation Amendment (Buyer Protections) Bill 2025 raises so many questions. Like the Rectification Orders and how they will work in practice. I have concerns for homeowners but I also see problems for builders.

As background, this area of disputes has unique issues like competing expert opinions, apportionment of liability being common and the need for a scope of works to rectify or establish loss and damage.

In my experience:

• homeowners do not want the original builder to return to rectify. For one, they will say the builder ‘stuffed it the first time, they will stuff it again’ and many builders will face cash flow problems by working on an effectively non- paying jobs (I don’t have sympathy with that position) but the reality is builders will seek the quickest and cheapest fix; and
• many defect claims lead to alleged proportionate liability defences and claims by builders against third parties such as an architect, engineer, surveyor, plumber or other contractor.

It is unknown how VBA/DBDRV will deal with this. Further, whether a duty of care is owed is also not a simple area and surely this will need to be dealt with by a Court or VCAT.

In that case, I can only presume a builder will seek a review of the Rectification Order at VCAT or avoid such an order being issued by raising an apportionable claim. Any thoughts from others on how this may play out?

If that occurs, what happens to the homeowner’s Rectification Order or potential order in the interim? Will it not be issued if there is such an alleged defence? Or will VBA/DBDRV have some role in considering whether an apportionment claim is rightly fully raised. It seems to be the onus will be on the builder.

If that means the order is not issued - will proportionate liability defences become the builders new means to oust dispute resolution at VBA/DBDRV and transfer proceedings to Tribunal or potentially Court?

Here is my initial view:

• enforcement of orders could be very challenging under the new regime. Builders returning and not getting it right; and
• the new regime will have difficulties with the proportionate liability regime if not properly considered; and
• the new regime puts pressure on builders to get expert evidence from the outset and make sure they do not miss an opportunity to apportion liability; and
• VBA/DBDRV will be on its toes to consider complex competing evidence issues, proportionate liability defences, competing scope of works, breaches and enforcement of orders as well.

This article is a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

Tagged as:

• property disputes