Building Legislation Amendment (Buyer Protection) Bill 2025 implications for building professionals

The Building Legislation Amendment (Buyer Protection) Bill 2025 will soon be law. This will be a significant shift for building legislation in Victoria and in particular for residential building.

I have copied a link to the AIA’s comments and support of today for the bill. No doubt there is strong sentiment in the community for this bill given its intent but there are equal concerns for the bill.

Given my experience with multi-party claims before the VCAT I make some observations from the perspective of a building lawyer with a particular focus on insurance. This should be of interest to Architects, Engineers, Plumbers and Building Surveyors in Victoria:

Rectification Orders and building permits

Rectification Orders will be a significant new feature and I have raised concerns on this forum as to the great unknown as to how and when and on what terms they will be issued and complied with.

However, I note an additional issue with the ROs being that under the new section 75E ‘What can a rectification order require?’ that at subsection (6) it is specifically stated that a building permit is not required to carry out building work required by an RO.

I find this confusing. How do we have new building work without a permit? It would be interesting to get views here of other professionals here. The mind boggles at the potential issues.

Proportionate liability changes

Proportionate liability - it is unclear how the current proportionate liability regime in Victoria will function with the ROs.

Put simply, proportionate liability or an apportionable claim is only where a claim arises from a failure to take ‘reasonable care’ (eg. negligence or certain subsections of section 8 of the Domestic Building Contracts Act) or section 18 of the ACL. So ROs aren’t captured.

Moreover, the new section 75B (4) states that if an RO is issued to more than one person, each person is ‘jointly and severally liable’. That is a big change.

This is certainly relevant to Architects, Engineers, Plumbers and Building Surveyors etc and their indemnity insurers.

Who can be subject to rectification orders?

However, the legislation importantly states that an RO may only be issued to any one of the following persons: (a) a person who carried out the work; (b) or a developer for a residential apartment building.

Therefore a plumber could be subject to such an order but I would certainly not expect an architect, engineer or building surveyor to have carried out work.

So, the question begs, what happens when there is an issue with design, certification or other liability? Does this mean the case is referred to VCAT because the builder or developer raises this. If so, will this encourage ‘hunts’ to establish the responsibility of another party or will an RO be ordered against a builder anyway leaving it to pursue separate proceedings.

It really is not clear but time will tell.

AIA support for new laws to safeguard homeowners

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

Tagged as:

• building law
• regulatory compliance
• litigation
• insurance law